The maker of Jif peanut butter, J.M. Smucker, announced on Monday that it will acquire Hostess Brands, the company behind Twinkies and other popular snacks, for $5.6 billion.

The deal comes as major U.S. food companies are looking to diversify their brands amid declining sales during the pandemic.

According to Reuters, J.M. Smucker was close to buying Hostess for about $5 billion, excluding the latter’s net debt of around $900 million. Hostess’s shares rose 16.3% in premarket trading on Monday, while J.M. Smucker’s shares fell 7.5%.

Hostess, which has a market value of nearly $3.73 billion, according to LSEG data, has seen its stock surge almost 27% since Aug. 25, when Reuters reported that it was exploring a sale after receiving interest from several food giants.

Hostess shareholders will receive $34.25 per share in cash and stock from J.M. Smucker, which is a 54% premium over the price before the report came out. The deal values Hostess’s equity at $4.55 billion, based on Reuters calculations.

The deal is part of a wave of consolidation in the food industry, which includes Campbell Soup’s $2.7 billion purchase of Sovos Brands, the maker of Rao’s sauces, and Unilever’s acquisition of Yasso, a premium frozen yogurt brand in North America.

Hostess, founded in 1930 and based in Lenexa, Kansas, is known for its iconic snack brands such as Ho-Hos, Ding Dongs, Zingers, and Voortman cookies and wafers.

The company went bankrupt twice, in 2004 and 2012, due to heavy debt from private equity owners and lack of innovation in its products.

J.M. Smucker, which also owns coffee and pet food brands, has a market value of more than $14 billion and had increased its prices of jams and jellies, which helped boost its profit outlook for the year.