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FEMSA

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Fomento Económico Mexicano, S.A.B. de C.V.
Company typeSociedad Anónima Bursátil de Capital Variable
BMV: FEMSA
NYSE: FMX (ADR)
IndustryBeverage, Retail
Founded1974; 50 years ago (1974)
Headquarters
Monterrey, Nuevo León
,
Mexico
Area served
Latin America and the United States
Key people
José Antonio Fernández
(Chairman)
Eduardo Padilla Silva
(CEO)
John Anthony Santa María Otazúa
(CEO of Coca-Cola FEMSA)[1]
Carlos Arenas
(CEO of OXXO)
RevenueIncrease MXN$506.7 billion (2019)
Increase MXN$28.0 billion (2019)
Total assetsIncrease MXN$637.5 billion (2019)
Number of employees
+230,000
DivisionsCoca-Cola FEMSA
FEMSA Comercio
FEMSA Negocios Estrategicos
Heineken (8%)[2]

Fomento Económico Mexicano, S.A.B. de C.V., doing business as FEMSA, is a Mexican multinational beverage and retail company headquartered in Monterrey, Mexico. It operates the largest independent Coca-Cola bottling group in the world and the largest convenience store chain in Mexico. It is also a shareholder of Heineken N.V.

FEMSA reported revenues of US$26.9 billion for 2019, making it the fifth largest company of Mexico.[3] It has operations in Latin America mainly through bottling plants, convenience stores, drugstores, fuel stations, and third-party logistic services, and in the United States, where it participates in the jan-san distribution industry. It is well known in Mexico for its convenience store chain Oxxo, it previously owned Cuauhtémoc Moctezuma Brewery (exchanged in 2010 for a 20% stake in Heineken N.V.), and for being the owner of C.F. Monterrey, a Liga MX football team.

FEMSA has been listed on the Mexican Stock Exchange since 1978 and on the NYSE through ADRs since 1998. It is a constituent of the IPC, the main benchmark index of the Mexican Stock Exchange, and of the S&P Latin America 40, which includes leading, blue chip companies from Latin America.

History

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FEMSA originated from the Cervecería Cuauhtemoc brewery, which was established by Isaac Garza Garza in 1890.[4] In 1909, Garza founded Vidriera Monterrey (now Vitro) to produce bottles for the Cuauhtémoc brewery.

The vertical strategic integration of Cervecería Cuauhtemoc began in 1936, with the establishment of Fábricas Monterrey, S.A. de C.V. for the production of bottle caps. Packaging operations expanded in 1957 with the production of labels and flexible packaging. During this period, FEMSA's operations were part of what became known as Grupo Monterrey (lit. the Monterrey Group), which also included interests in banking, steel, and other packaging operations.

In 1974, Grupo Monterrey was divided into two branches by the descendants of the founding families of Cervecería Cuauhtémoc. The steel and packaging operations gave rise to the creation of Corporación Siderúrgica S.A. (later consolidated into Grupo ALFA), which would be controlled by the Garza Sada family, and the beverage and banking operations led to the creation of FEMSA, whose control fell to the Garza Lagüera family. FEMSA was listed on the Mexican Stock Exchange on September 19, 1978.

In 1985, Cuauhtémoc merged with Moctezuma to form Cervecería Cuauhtémoc Moctezuma.[4] FEMSA then undertook an extensive corporate and financial restructuring that was completed in December 1988.[5]

In 1993, Coca-Cola purchased a 30 percent stake in FEMSA, creating the Coca-Cola FEMSA division.[6]

In January 2006, FEMSA Cerveza acquired Kaiser Cervejarias from Molson Coors Brewing Co.[7]

On December 19, 2006, Coca-Cola FEMSA announced its attempt to buy out Mexican juice producer Jugos del Valle. It was acquired in 2007.

On December 20, 2007, Cascade Investments LLC, whose main partner is Bill Gates, announced it would invest $390 million in FEMSA. The Reuters news agency stated that after this investment, "Gates owns a 1.2 percent stake in Femsa's Series B shares, a 5 percent stake in Series D-B shares, and a 5 percent stake in Series D-L shares." This investment caused the Bill and Melinda Gates' foundation to become the institutional holder possessing the most shares of FEMSA.[8]

On January 11, 2010, the Dutch brewing company Heineken International purchased FEMSA Cerveza (Cervecería Cuauhtémoc Moctezuma), the beer operations of FEMSA, in a stock swap that left FEMSA a 20% owner in the Heineken.[9]

In 2011, Coca-Cola FEMSA acquired regional Mexican Coke bottler Grupo Cimsa for 11 billion MXN (US$838 million).[10]

In July 2012, Coca-Cola FEMSA announced that it had purchased Lácteos Santa Clara, one of the largest dairy bottlers in Mexico.[11]

In August 2015, FEMSA, through its subsidiary FEMSA Comercio entered the drugstore business in South America by acquiring a majority interest in Socofar, a leading South American drugstore operator based in Santiago, Chile.[12]

In March 2017, FEMSA's Imbera division announced their shift to hydrocarbons in manufacturing their Coke beverage coolers.[13] The company enacted the manufacturing shift in order to meet higher efficiency standards. In October 2017, FEMSA Logistica rebranded to Solistica.[14]

In early 2019, FEMSA, through its subsidiary FEMSA Comercio, acquired Ecuadorean company Corporacion GPF.[15] In September 2019, FEMSA signed a deal to acquire a minority stake in Jetro Restaurant Depot.[16] In November 2019, FEMSA Logistics subsidiary Solistica completed their acquisition of Brazilian company AGV.[17] Also in November 2019, FEMSA Comercio closed the acquisition of a 50 percent stake in Raizen Conveniencias.[18]

In March 2020, FEMSA acquired a majority stake in WAXIE Sanitary Supply and North American Corporation, to form a new platform within the Jan-San, Packaging and Specialized distribution industry in the United States.[19]

In 2022, FEMSA acquired Swiss retail and food service holding company Valora, which operates multiple brands of convenience stores and quick service food outlets in Switzerland, Germany, Austria, Luxembourg, and the Netherlands.[20][21]

In May 2023, FEMSA sold €333 million in Heineken N.V. to the company. FEMSA will no longer hold any shares in Heineken N.V. and Heineken Holding N.V. other than the Heineken Holding N.V. shares underlying the exchangeable bond.[22]

Divisions

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FEMSA Comercio

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Proximity division

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FEMSA Comercio operates OXXO, the leading convenience store chain in Mexico and a growing portfolio of other small-format retail chains in Latin America.[23]

OXXO, a subsidiary of FEMSA, was established in 1978.[23] In 2010, OXXO, a subsidiary of FEMSA Comercio, partnered with Heineken Mexico. OXXO's ten-year agreement with Heineken Mexico was renegotiated in early 2019.[24]

In 2013 the FEMSA group acquired an 80% holding in the Mexican arm of restaurant chain Gorditas Doña Tota for US$120 million, their interest being limited to operations within Mexico.[25] Operations within the United States remain in the hands of the original business owners.[26] The company operates as a subsidiary of Femsa Comercio S.A. de C.V.[27] As of 2017 the company claims more than 200 restaurants in 60 Mexican cities and towns.[28][29] Gorditas Doña Tota started in 1952 when Carlota Murillo of Ciudad Victoria, Tamaulipas began selling gorditas on the street, from a cart on the sidewalk.[28]

Health division

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In November 2012, FEMSA announced it had purchased a 75 percent controlling stake in convenience store Farmacias Yza.[30] In May 2013, FEMSA announced the acquisition of another convenience store, Farmacias FM Moderna.[31]

In September 2015, FEMSA Comercio acquired a controlling stake in SOCOFAR.[32] In December 2015, FEMSA, through FEMSA Comercio, acquired SOCOFAR, a Chilean drugstore company operating the Cruz Verde drugstore network in Chile and Colombia. SOCOFAR was founded in the 1980s and is the largest drugstore chain in Chile, a strong presence in Colombia.[33]

In September 2018, FEMSA, through FEMSA Comercio, announced the acquisition of Ecuadorian drugstore chains Fybeca and SanaSana.[34]

In May 2019, FEMSA Comercio completed its acquisition of Fybeca.[35] FEMSA Comercio announced in December 2019 plans to acquire the remaining 40 percent minority stake of SOCOFAR.[36] FEMSA acquired the remaining stake in SOCOFAR in January 2020.[37]

Fuel division

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OXXO Gas is an affiliate of OXXO, and as of 2020 operates approximately 550 stations in 17 Mexican states.[38]

Coca-Cola FEMSA

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Main article: Coca-Cola FEMSA

FEMSA owns 47.9% of the world's largest bottler of Coca-Cola by volume, Coca-Cola FEMSA, S.A. de C.V. (NYSE: KOF), which operates in ten countries covering the metropolitan area of Mexico City, southeast Mexico, Central America, and South America.

Coca-Cola FEMSA is the anchor bottler of Coca-Cola and its related soft drink products in much of Latin America. The company is an important part of the Coca-Cola System. During 2019, the company produced and sold 11.1% of Coca-Cola's volume worldwide. This makes it the largest Coca-Cola bottler in the world.[39]

The company is owned 47.9% by FEMSA, 28.1% by The Coca-Cola Company and the remaining interest trades on the New York Stock Exchange and the Mexico City Stock Exchange.[40] The company is headquartered in Monterrey.

The company is the bottler of Coca-Cola in half of Mexico (including Mexico City, Oaxaca, Tabasco, Guanajuato, Querétaro, Veracruz, Puebla and Michoacan) the Buenos Aires region of Argentina, São Paulo and other areas of Brazil, greater Guatemala City, Guatemala, most of Colombia, and all of Costa Rica, Nicaragua, Panama, Venezuela and the Philippines (until 2018).

The company also distributes beer and bottled water in some of its territories.

On 29 June 2011, was announced that FEMSA will merge to the bottling division of Grupo Tampico, agreeing to pay 9.3 billion pesos (790 million dollars) in stock for the Coke bottling operations of Grupo Tampico.[41] In September 2011, Coca-Cola FEMSA acquired Grupo Cimsa, a Coke bottler in Morelos, Mexico, Guerrero and Michoacan.[10]

FEMSA Negocios Estratégicos

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FEMSA Negocios Estratégicos (formerly known as FEMSA Insumos Estratégicos) provides logistics, point-of-sale refrigeration solutions[buzzword] and plastics solutions[clarification needed] to FEMSA's business units and third-party clients. It is subsequently divided into:

Solistica

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Solistica is a third-party logistics provider for a number of industries, including pharmaceuticals, automotive, technology, and consumer goods. Solistica manages primary distribution for Coca-Cola FEMSA and Heineken and secondary distribution for FEMSA Comercio's Proximity Division.[42]

Imbera

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Imbera manufactures equipment for the soft drink, beer and food service industries, including coolers, food processing, storage and weighing equipment.[42] Imbera has manufacturing plants in Mexico, Colombia, and Brazil.[43]

Plásticos Técnicos Mexicanos (PTM)

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PTM provides solutions[buzzword] and develops "plastic transformation projects" tailored to FEMSA Enterprises and third-party clients in terms of materials handling, automobiles, and food/beverages. Their capacity includes the different plastic manufacturing processes: blowing, injecting, heat forming, and extrusion.[44]

See also

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References

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  1. ^ "John Anthony Santa María Otazua Chief Executive Officer". Bloomberg.
  2. ^ Mexico's FEMSA focuses back on retail, bottling with Heineken stake sale (Reuters, February 17, 2023)
  3. ^ "Top 10 del Ranking 2014". CNN Expansión. Archived from the original on 2014-06-27. Retrieved 2014-06-26.
  4. ^ a b "The History of Cinco de Mayo and Mexican Beer". Home Brew Academy. May 2020. Retrieved 21 January 2021.
  5. ^ John T. Hyatt (27 April 2016). Mexican Business Culture: Essays on Tradition, Ethics, Entrepreneurship and Commerce and the State. McFarland. ISBN 9781476623139. Retrieved 21 January 2021.
  6. ^ Tim Golden (27 April 1993). "Coke Plans to Buy 30% Stake In Mexican Soft Drink Unit". The New York Times. Retrieved 21 January 2021.
  7. ^ Molson Coors Archived 2007-10-11 at the Wayback Machine Press release
  8. ^ "Bill Gates buys stake in Mexican brewer Femsa". Reuters. 2007-12-21. Retrieved 2019-09-30.
  9. ^ "Heineken agrees Mexican beer deal". BBC News. January 11, 2010. Retrieved May 2, 2010.
  10. ^ a b Guthrie, Amy. "Mexico's Coca-Cola Femsa to buy bottler Cimsa". MarketWatch. Retrieved 2015-04-12.
  11. ^ "Vía Jugos del Valle, FEMSA toma control del productor de lácteos Santa Clara 2012/07/04 | Excélsior" (in Spanish). Excelsior.com.mx. 19 January 2013. Retrieved 2017-12-13.
  12. ^ "FEMSA Comercio To Buy Majority Stake In Chile's Grupo Socofar For $998 Mln". RTT News. 14 August 2015.
  13. ^ Garry, Michael (20 March 2017). "Imbera migrates Coke coolers to HCs". Hydrocarbons 21. Archived from the original on 15 October 2017. Retrieved 9 April 2021.
  14. ^ Silva Mendez, Miguel Ángel (20 October 2017). "Es Solistica, nuevo nombre de FEMSA Logística". Automores-Rev.
  15. ^ "Mexico's Femsa to enter Ecuadorean drug store business". Reuters. 24 September 2018.
  16. ^ "FEMSA completes investment in US cash and carry leader Jetro Restaurant Depot". Intrado. 8 November 2019.
  17. ^ "FEMSA's (FMX) Unit Acquires AGV, Expands Footprint in Brazil". Yahoo! Finance. 30 December 2019.
  18. ^ "FEMSA Comercio announces the Closing of joint venture agreement with Raízen". Intrado. 1 November 2019.
  19. ^ "FEMSA Acquires North American and WAXIE". Cleary Gottlieb. 10 March 2020.
  20. ^ "FEMSA completes acquisition of Valora". FEMSA. 10 Oct 2022. Retrieved 9 Oct 2024.
  21. ^ Pekel, Charlotte (8 Oct 2024). "Diese Unternehmer stecken hinter Yorma's, Ditsch und Le Crobag". manager magazin (in German). Retrieved 9 Oct 2024. Im selben Jahr fiel das Unternehmen in mexikanische Hände: Femsa, der mexikanische Getränkeabfüller und Einzelhandelsriese, übernahm Valora und damit auch das erfolgreiche SB-Konzept. [In the same year, the company fell into Mexican hands: FEMSA, the Mexican beverage bottler and retail giant, took over Valora and with it the successful self-service concept.]
  22. ^ "Heineken N.V. purchases €333 million in shares from FEMSA". Heineken N.V. purchases €333 million in shares from FEMSA. Retrieved 2023-12-11.
  23. ^ a b "Oxxo stores are everywhere and they continue to multiply". Mexico News Daily. 30 June 2014.
  24. ^ "OXXO and HEINEKEN Mexico extend their commercial relationship" (Press release). Intrado. 26 February 2019.
  25. ^ Redacción. "Femsa, adquiere el 80% de "Doña Tota"".
  26. ^ "FEMSA adquiere por 120 mdd a Gorditas Doña Tota". Archived from the original on 2017-12-01. Retrieved 2017-12-13.
  27. ^ "Company Overview of Gorditas Dona Tota S.A. de C.V." bloomberg.com. Bloomberg. Retrieved 4 December 2017.
  28. ^ a b "Este mapa te muestra el origen de las 32 marcas más populares de México" [This map shows you the origin of the 32 most popular brands in Mexico]. Vangardia.mx. 12 September 2017. Retrieved 1 December 2017. La receta de gorditas de esta mujer se puede encontrar ahora en más de 60 ciudades y 200 restaurantes. [This woman's recipe for gorditas can now be found in more than 60 cities and 200 restaurants.]
  29. ^ "Corporate website". donatota.com. Gorditas Dona Tota. Archived from the original on 4 December 2017. Retrieved 4 December 2017.
  30. ^ "Femsa adquiere participación de farmacias YZA". Economist.
  31. ^ Rich Smith (13 May 2013). "FEMSA Buys Another Drugstore Chain".
  32. ^ "FEMSA (FMX) Buys Big John, Enhances Operations in Chile". Zacks Equity Research.
  33. ^ "Mexico's Femsa to buy Chile pharmacy chain Cruz Verde for $1 bln". Reuters. 13 August 2015.
  34. ^ "Mexico's FEMSA buys Ecuadorian drugstore operator". S&P Global.
  35. ^ "FEMSA closes purchase of Fybeca in Ecuador". LexLatin.
  36. ^ "FEMSA's (FMX) Unit Acquires AGV, Expands Footprint in Brazil". Yahoo! Finance.
  37. ^ "FEMSA Buys a 40% Socofar Stake, Boosts Drugstore Operations". Yahoo! Finance.
  38. ^ "Mexico's Femsa Announces Major Expansion Of OXXO-Branded Gas Stations". Forbes.
  39. ^ "Coca-Cola FEMSA: The World's Largest Coca-Cola Bottler At A Discount To Fair Value". Seeking Alpha. Retrieved 2021-06-28.
  40. ^ "FEMSA - Corporate Structure". Retrieved 2016-03-30.
  41. ^ Elinor Comlay (29 June 2011). "Mexico's Coca-Cola FEMSA open to more deals". Reuters.com. Retrieved 30 June 2011.
  42. ^ a b "2020 Annual Report". FEMSA Annual Report.
  43. ^ "Imbera Cooling". Retrieved 2016-03-30.
  44. ^ "PTM". Retrieved 2016-03-30.
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