Starbucks Korea’s Green Step: NFTs for Sustainable Cup Choices 
OPNX Crypto Trading Platform Announces Shut Down This Month 
Rishi Sunak wants to cut the cost of ‘sicknote’ Britain 
High interest rates aren’t going away anytime soon – a business economist explains why 
New EU trade rules could put poor countries in a billion dollar ‘green squeeze’ 
McDonald’s Rolls Out $5 Meal Deals to Emphasize Affordability Amid Rising Costs 
The budget is full of good news, but good news isn’t the same as good management 
From Burger King to McDonald’s: Fast-Food Prices Surge Dramatically in Recent Years 
Inflation is slowly falling, while student debt is climbing: 6 graphs that explain today’s CPI 
Why banks consider renewable energy to be a riskier investment than fossil fuels 
Skepta and PUMA Launch Groundbreaking Collection 
Weather risk can move markets months in advance 
FTX Hedge Fund Arm Alameda Research Scraps Grayscale Lawsuit 
The UK has become the world’s fourth largest exporter, but can it maintain this momentum? 
J.M. Smucker acquires iconic Twinkies maker Hostess Brands in a monumental $5.6 billion deal, merging two major American snack titans and reshaping the landscape of the U.S. packaged food industry.
The purchase price, which doesn't include debt, is approximately $4.6 billion. Smucker, known for its popular Jif peanut butter, will compensate Hostess shareholders $34.25 per share in a cash-and-stock offer. This represents a premium of 54% on the stock since Reuters first reported Hostess Brands' exploration of a potential sale.
Since news of the sale process broke, shares of Hostess have surged by 27%, currently trading at $33.49 in early Monday trading. Meanwhile, Smucker's shares have declined by 7% as some investors view the deal overly expensive.
Smucker expects the transaction to conclude during the third quarter of its current fiscal year. Based on the estimated 2023 results of Hostess Brands, the deal represents adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of approximately 17.2 times.
This strategic move by Smucker aligns with the broader trend of major U.S. packaged food companies expanding their brand portfolios amid shifting market dynamics brought on by the pandemic.
With dwindling pandemic-era fortunes, companies within the U.S. packaged food industry have witnessed an increase in mergers. Faced with fading benefits from price hikes, many market players seek to improve volumes by rebranding their portfolios.
Hostess Brands became an attractive acquisition target after implementing successful price hikes that boosted revenue. However, concerns arose over the long-term growth potential as the company experienced consistent declines in volume.
The union between Smucker and Hostess follows a series of other sector deals. It includes Campbell Soup's $2.7 billion acquisition of Sovos Brands and Unilever's purchase of North American premium frozen yogurt brand Yasso.
Hostess, headquartered in Lenexa, Kansas, boasts a rich history dating back to its founding in 1930. The company is responsible for household favorites such as Ho-Hos, Ding Dongs, Zingers, and Voortman cookies and wafers.
Through an extensive portfolio revamp, Hostess successfully generated over $1 billion in revenue by the end of 2020. Despite sales volume weakening, timely price adjustments have helped the company maintain its revenue growth trajectory.
Photo: Business Wire
