Milberg Weiss Announces Class Action Lawsuit Against Interstate Bakeries Corporation.

Business Editors/Legal Writers

NEW YORK--(BUSINESS WIRE)--March 14, 2003

The law firm of Milberg Weiss Bershad Hynes & Lerach LLP announces that a class action lawsuit was filed on March 14, 2003, on behalf of purchasers of the securities of Interstate Bakeries Corporation ("IBC" or the "Company") (NYSE: IBC) between September 17, 2002 and December 17, 2002, inclusive. A copy of the complaint filed in this action is available from the Court, or can be viewed on Milberg Weiss' website at: http://www.milberg.com/cases/ibc/

The action, numbered 03-0222, is pending in the United States District Court, Western District of Missouri, located at the Charles Evans Whittaker Courthouse, 400 E. 9th Street, Kansas City, Missouri, 64106, against defendants IBC, Charles A. Sullivan, James Elsesser, Michael Kafoure and Frank Coffey.

The Complaint alleges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market between September 17, 2002 and December 17, 2002, thereby artificially inflating the price of IBC securities. The Complaint alleges that IBC produces, markets, distributes and sells a wide range of bread, rolls, snack cakes, donuts, sweet goods and related products. Throughout the Class Period, as alleged in the complaint, defendants issued statements regarding the Company's financial performance and filed a 10-Q with the Securities and Exchange Commission concerning the Company's financial results. These statements were materially false and misleading because they failed to disclose and/or misrepresented the following adverse facts, among others: (i) that at least as early as September 17, 2002, IBC was experiencing a negative variance with respect to sweet goods as compared to the prior year and, therefore, defendants could not have perceived that sales of sweet goods were currently returning to normal levels; (ii) that IBC did not maintain sufficient centralized control over price increases to ensure that the Company could raise prices on bread products without damaging profitability. Rather, defendants knew that an increase in prices typically would result in a sacrifice in market share and that IBC was exposed to significant risk with respect to its ability to attain profits based upon commodity prices; and (iii) that sales on single item snack cakes, the Company's highest profit margin product, had dropped precipitously.

On December 17, 2002, the Company shocked the market when it announced that earnings for the second quarter, which ended on November 16, 2002, were $11.6 million, or $0.26 per share, down 36.5% from $21 million, or $0.41 per share during the same period in the previous year on sequentially flat sales. On this news, shares of IBC fell $8.16 to $15 -- their lowest price in 19 months.

If you bought the securities of IBC between September 17, 2002 and December 17, 2002, you may, no later than April 21, 2003, request that the Court appoint you as lead plaintiff. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Milberg Weiss Bershad Hynes & Lerach LLP, or other counsel of your choice, to serve as your counsel in this action.

Milberg Weiss Bershad Hynes & Lerach LLP, a 190-lawyer firm with offices in New York City, San Diego, San Francisco, Los Angeles, Boca Raton, Seattle and Philadelphia, is active in major litigations pending in federal and state courts throughout the United States. Milberg Weiss has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of World War II and other human rights violations, and has been responsible for more than $30 billion in aggregate recoveries. The Milberg Weiss Web site (http://www.milberg.com) has more information about the firm.

If you wish to discuss this action with us, or have any questions concerning this notice or your rights and interests with regard to the case, please contact the following attorney :

Steven G. Schulman
One Pennsylvania Plaza, 49th fl.
New York, NY 10119-0165
Phone number: [phone]

Email: [e-mail]
Website: www.milberg.com