(Reuters) - JM Smucker said on Friday it would sell its packaged pastries brand Cloverhill and cinnamon rolls label Big Texas to packaged food maker JTM Foods for about $40 million, as the company looks to cut costs in its sweet baked snacks segment.

The divestiture, which also includes some of the Jif peanut butter maker's private-label products, would help it focus on growing Twinkies-maker Hostess Brands, which the company acquired in 2023.

"This decision continues the ongoing work to ensure our manufacturing network is optimized to mitigate costs and reduce complexity," said Dan O'Leary, senior vice president and general manager, of the company's sweet baked snacks and pet products unit.

Like other packaged food firms, JM Smucker has been countering choppy demand from consumers as they temper spending on snacks and sweets and switch to healthier snacking options.

The sweet baked snacks segment formed 13.9% of the company's total net sales in the second quarter of fiscal 2025, reported in November.

JM Smucker expects its full-year net sales from the divested brands to be about $60 million. The transaction is likely to close in the fourth quarter ending April 30.