Sept 11 Reuters J.M. Smucker said on Monday it will buy Twinkiesmaker Hostess Brands in a 5.6 billion deal, as major U.S. packaged food companies look to expand their brand portfolios with pandemicera fortunes dwindling.

In recent months, the U.S. packaged food industry has seen an uptick in mergers as most of the companies seek to improve volumes by rebranding portfolios after benefits from price hikes started wavering.

The equity value of the deal stood at 4.55 billion, as per Reuters calculations, with Jif peanut butter maker J. M. Smucker paying Hostess shareholders 34.25 per share. The cashandstock offer represents a premium of 54 on the stock since the day Reuters reported the company was exploring a sale.

Shares of Hostess have since surged 27 and were up 19 at 33.49 in premarket trading on Monday, while those of J.M. Smucker39;s were down 7.

Hostess Brands became an acquisition target after its price hikes boosted revenue but fueled investor concerns over its prospects with its volume growth consistently declining.

The J.M. Smucker and Hostess deal follows a spree of other deals including Campbell Soup39;s 2.7 billion deal for Rao39;s sauce maker Sovos Brands and Unilever39;s purchase of premium frozen yogurt brand Yasso in North America.

J. M. Smucker said the deal is expected to close in the third quarter of its current fiscal year and represents an adjusted earnings before interest, taxes, depreciation, and amortization EBITDA of about 17.2 times based on…