J. M. Smucker enters US$5.6B deal to acquire Hostess Brands
USA – The J. M. Smucker Co., a leading consumer foods company, has signed a definitive agreement to acquire Hostess Brands for a total enterprise value of approximately $5.6 billion.
The transaction includes the Hostess Brands sweet baked goods brands (Hostess Donettes, Twinkies, CupCakes, DingDongs, Zingers, CoffeeCakes, HoHos, Mini Muffins and Fruit Pies) and the Voortman® cookie brand.
JM Smucker will also take over manufacturing facilities in Emporia, Kansas; Burlington, Ontario; Chicago, Illinois; Columbus, Georgia; Indianapolis, and Indiana.
A manufacturing facility in Arkadelphia, Arkansas (which is currently under construction) and a distribution facility in Edgerton, Kansas will also become part of the Ohio based company.
Additionally, approximately 3,000 employees will join the Company in conjunction with the transaction.
In a statement, J. M. Smucker noted that the acquisition expands the expands its offering into growing categories and accelerates its focus on convenient consumer occasions.
“ The acquisition adds Hostess Brands iconic snacks and innovation in the sweet baked goods category to the company’s current offering of beloved brands,” JM Smucker said.
- M SMucker already owns national brands in coffee, consumer foods, dog snacks and cat food categories.
Some of its products include Folgers, Dunkin’, Café Bustelo, Jif, Smucker’s Uncrustables, Smucker’s, Milk-Bone and Meow Mix.
It further noted that the acquisition positions it to deliver on consumer needs across occasions with greater convenience and selection.
“Further, the Company and Hostess Brands complementary capabilities will drive further growth and innovation,” the company added.
Hostess Brands also offer a strong financial profile that includes net sales contribution of approximately US$1.5 billion, with an estimated mid-single digit percentage annual growth rate and annual run-rate cost synergies of approximately US$100 million.
“We are excited to announce the acquisition of Hostess Brands, which represents a compelling expansion of our family of brands and a unique opportunity to accelerate our focus on delighting consumers with convenient solutions across different meal and snacking occasions,” said Mark Smucker, Chair of the Board, President and Chief Executive Officer.
“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 Brands offers, to drive continued growth.
J.M SMucker says the transaction has been unanimously approved by the boards of directors of both companies is anticipated to close in the third quarter of the Company’s current fiscal year ending April 30, 2024.
Meanwhile, the Board of Directors of Kellogg Company, a US-based breakfast cereal company, have formally approved the previously announced separation into two independent, publicly traded companies, Kellanova and WK Kellogg Co.
Upon completion of the separation on October 2, 2023, Kellogg Company will be renamed Kellanova, and will continue to trade on the New York Stock Exchange (NYSE) under the ticker symbol “K”, while WK Kellogg Co is expected to begin trading on the NYSE under the ticker symbol “KLG”.
Steve Cahillane, will remain Chairman and Chief Executive Officer of Kellanova while Gary Pilnick, will serve as WK Kellogg Co’s Chairman and Chief Executive Officer following the separation.
For all the latest food industry news from Africa and the World, subscribe to our NEWSLETTER, follow us on Twitter and LinkedIn, like us on Facebook and subscribe to our YouTube channel.
