Smucker’s Agrees to Buy Hostess for $5.6B

Hostess snacks | Image by calimedia

The J.M. Smucker Co. has purchased Hostess Brands, Inc. in a deal worth more than $5 billion.

Hostess Brands Inc., the company behind classic snack foods like Twinkies, DingDongs, and HoHos, announced Monday that it had entered into a definitive agreement with The J.M. Smucker Co. to buy it for $34.25 per share in a cash and stock transaction valued at approximately $5.6 billion.

“Today represents another exciting chapter for our company as we combine our iconic snacking brands with The J.M. Smucker Co.’s family of beloved brands,” Andy Callahan, president and CEO of Hostess Brands, said in a press release announcing the partnership.

Callahan said he believes the partnership will lead to accelerated growth because of the companies’ complementary strategies and similar core business principles and operations.

“Hostess Brands and The J.M. Smucker Co. share a deep commitment to inspiring moments of joy and satisfaction through our products, and we look forward to continuing to do so as part of The J.M. Smucker Co. family,” Callahan said.

Mark Smucker, president and CEO of The J.M. Smucker Co., said the purchase would help drive the growth of the Smucker’s brand.

“With this acquisition, we are adding an iconic sweet snacking platform; enhancing our ability to deliver brands consumers love and convenient solutions they desire; and leveraging the attributes Hostess offers, including its strong convenience store distribution and leading innovation pipeline, combined with our strong commercial organization and consistent retail execution across channels to drive continued growth,” Smucker said, per the press release.

“Our organization is well positioned to deliver on the great potential our expanded family of brands offers, as has been reflected by our history of growth through acquisition and the successful integration of new categories to our business. We look forward to this exciting new chapter for The J.M. Smucker Co,” Smucker continued.

As previously reported by The Dallas Express, Hostess Brands has struggled over the past few years and recently began attracting buyout interest following a decision by the company to increase prices on its products in a bid to boost revenue.

Although the buyout could enhance the Smucker company and its many brands, the transaction will also strap the company with approximately $900 million in net debt.

The deal is anticipated to close in the spring of 2024. Morgan Stanley & Co. LLC and Morgan, Lewis & Bockius LLP are serving as Hostess Brands’ financial and legal advisors, according to the release.

Support our non-profit journalism

Submit a Comment

Your email address will not be published. Required fields are marked *