Investors will get $34.25 in cash and stock for each Hostess Brands share, according to a statement on Monday. The price, which includes $900 million in debt, represents a 22% premium to Hostess’ closing price on Sept. 8.

While consumers rushed back to the center of grocery stores during the pandemic, and revenue from packaged food had stayed elevated thanks to higher prices, consumers are now returning to healthier, fresher foods at the perimeter of the store. 

That adds pressure on companies in packaged food to either innovate to keep consumer attention or acquire new brands — and snacking, Hostess’ forte, is among the remaining growth areas in the industry. A June report from Goldman Sachs called Campbell Soup Co. and Smucker “at risk” in an expected moderation of growth across food, in part from their lack of snacking exposure relative to rivals like Mondelez International Inc. and Hershey Co.

Campbell itself moved to bulk up last month, saying it would buy Sovos Brands Inc. in a $2.7 billion deal.

Founded in 1930, Hostess owns some of the biggest household snack brands in the US, including Donettes, Ding Dongs and Zingers, as well as a variety of Voortman cookies and wafers, according to its website. Its Twinkies cakes are a venerable bit of Americana, ingrained in pop culture through appearances like the metaphorical use of the spongy, golden snack in “Ghostbusters.” 

Lenexa, Kansas-based Hostess tumbled into bankruptcy in both 2004 and 2012, beset by moribund marketing and high debt levels. Billionaire C. Dean Metropoulos and Apollo Global Management Inc. bought the company in 2013 and took it public through a special-purpose acquisition company in 2016, revitalizing sales with a focus on Twinkies’ iconic brand halo.

Shares of Hostess Brands have surged more than 26% since before Aug. 25, when Reuters reported the company was exploring a sale after fielding takeover interest from major snack-food makers. The firm had a market value of about $3.7 billion as of the end of last week.

Hostess shares rose 19% to $33.50 in New York trading at 12:05 p.m., while Smucker sank 6.2%. Smucker had already fallen 11% this year, giving it a market value of $14.5 billion.

Homemade Cider

J.M. Smucker was founded in 1897 by Jerome Monroe Smucker, selling homemade cider and apple butter door to door from the back of his horse-drawn wagon. The company, now run by the fifth generation of the Smucker family, is best known for its namesake jam and jelly, Folgers coffee and Jif peanut butter. It also makes Carnation evaporated milk and Milk-Bone dog treats. 

Smucker already has a fast-growing spongy snack of its own: Uncrustables frozen sandwiches, which it bought for about a million dollars in 1999. The brand now generates $650 million in annual sales, and the company says it’s on its way to $1 billion soon.

Orrville, Ohio-based Smucker in 2015 bought Big Heart Pet Brands Inc. in a cash-and-stock deal worth $5.8 billion. Three years later, it deepened its foray into pet food by acquiring Ainsworth Pet Nutrition, though this year it divested several other pet brands.

In an interview with Bloomberg in June, Chief Executive Officer Mark Smucker said the company specialized in modernizing brands.

–With assistance from Thomas Mulier.