JM Smucker to buy Twinkies maker Hostess Brands in $5.6 billion deal

JM Smucker on Monday agreed to buy Twinkies maker Hostess Brands for $5.6 billion including debt in a deal that unites two major American snack makers.

The deal was worth about $4.6 billion excluding debt, with Jif peanut butter maker Smucker paying Hostess shareholders $34.25 per share. The cash-and-stock offer represents a premium of 54% on the stock since the day Reuters reported the company was exploring a sale.

Hostess shares have surged 27% since the report about the sale process and were up 19% at $33.49 in early trading on Monday, while Smucker's shares were down 7% as investors viewed the deal as too expensive.


Smucker said the deal, which is expected to close in the third quarter of its current fiscal year, represents adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of about 17.2 times based on its estimate of Hostess Brands' 2023 results.