Home » Behavioural Investing » Canadian Owner of Twinkies buys US Dairy Morningstar $1.5 Billion What Else? $SAP.ca #Hostess #twinkies

Canadian Owner of Twinkies buys US Dairy Morningstar $1.5 Billion What Else? $SAP.ca #Hostess #twinkies

Box of Twinkies

Box of Twinkies (Photo credit: Wikipedia)

Saputo which trades on Toronto (TSX:SAP) has made an all cash deal for US Dairy Morningstar. Saputo believes the deal will be accretive immediately. Nice change from other deals which cause pain and suffering for two years or more.

The interesting tidbit is Saputo owns a division called Vachon which owns the Canadian rights to Twinkies. Some of the cash flow that is buying a dairy comes from the profitable operation of Twinkies. So it took the Canadians to figure out the economics of a Twinkie and go on to make other acquisitions.

Now that Twinkies and other assets are for sale will Saputo make an offer for some of the American rights. Or will it sell the Canadian rights to someone who wants to combine everything in North America. Perhaps the Canadian manufacturing facilities can churn out Twinkies instead of that greedy union that lost 18,000 jobs and make some manufacturing profits without the marketing and capital risks.

George Gutowski writes from a caveat emptor perspective. Follow him on twitter@financialskepti

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