Coca-Cola FEMSA S.A.B. de C.V.
), has completed the acquisition of the second-largest
privately-owned bottler in the Brazilian Coca-Cola system, Spaipa
S.A. Industria Brasileira de Bebidas (Spaipa). The $1.9 billion
takeover will augment its Brazilian business volume by 40%.
Coca-Cola FEMSA is co-owned by the
Coca Cola Company
Fomento Economico Mexicano S.A.
) also known as FEMSA. It produces and distributes Coca-Cola,
Fanta, Sprite, Del Valle and other trademark beverages of The
Coca-Cola Company. It also distributes bottled water, juices,
teas, isotonics, beer and other beverages in Mexico, Guatemala,
Nicaragua, Costa Rica, Panama, Colombia, Venezuela, Brazil,
Argentina and Philippines.
The all-cash deal, financed with new bank debt, will be
geographically beneficial as it will link KOF's distribution
territories in the states of São Paulo and Mato Grosso do
Spaipa has operations in the states of São Pauloand Parana,
with four bottling plants, seven distribution centers and more
than 6,000 employees serving almost 17 million consumers.
The acquisition is expected to accrue $33 million as earnings
before interests, taxes, depreciation and amortization (EBITDA)
in the coming 18 to 24 months to KOF. The deal will allow it to
serve a 66 million strong customer base and also increase its
participation in Leo Alimentos athletic event to 20%.
Coca Cola Femsa, which carriesa Zacks Rank #4 (Sell) is on an
acquisition spree and has been acquiring Coke bottlers in the
Latin American region for the last two years. In January, the
cola giant entered into a definitive agreement to acquire
Mexico-based Coca-Cola bottler Grupo Yoli, S.A. de C.V. for $700
Again, in August, it acquired its Brazilian peer - Companhia
Fluminense de Refrigerantes - for $448 million in an all-cash
transaction. The company is also expanding its operations beyond
Latin America and acquired a 51% interest in Coca-Cola Bottlers
Philippines, Inc. in 2013.
Beverage giants are fast expanding into emerging markets.
), another beverage player, traded its bottling operations in
China for a position in Tingyi Holding's beverage business.
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