Hostess Brands  (TWNK) – Get Free Report shares powered higher Monday following a report that suggested the maker of Twinkies snack cakes is preparing for a $5 billion takeover by Jif peanut butter maker JM Smucker  (SJM) – Get Free Report.

Hostess, which has seen a 27% surge in its share price since reports emerged from Reuters in August that it was exploring sale options, has a market value of around $3.7 billion, around a quarter of the value of JM Smucker, based on Friday’s closing share price.

The Wall Street Journal said the deal could come as early as Monday, with JM Smucker beating out packaged food rivals General Mills GIS for the twice-bankrupt Hostess brands.

Hostess, first formed in 1930, returned to the capital markets in 2016 through a $725 million deal with private equity firm Gores Group. The Lenexa, Kansas-based snack group brought a renewed focus on U.S. and Canada markets, where it generates nearly all of its revenues, thanks in part to a new line of products that target younger consumers. 

Last month, Hostess said revenues for the three months ending in June rose 3.5% from last year to $352.4 million, missing analysts’ estimates, despite a series of price increases used to absorb higher inputs costs. 

Still, the group lifted its full-year profit target, to the “higher end” of its previous forecast of $315 million to $325 million, adding it’s “well-positioned for attractive shareholder returns as we build a premier, pure-play snacking company.”

Hostess Brands shares were marked 13.2% higher in pre-market trading to indicate an opening bell price of $31.82 each. JM Smucker shares edged 0.9% higher to $142.81 each.

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