FEMSA

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 integrates the largest independent Coca-Cola bottling group in the world and the largest convenience store chain in Mexico. It is also the second largest shareholder of Heineken N.V..

Fomento Económico Mexicano, S.A.B. de C.V.
TypeSociedad Anónima Bursátil de Capital Variable
BMV: FEMSA NYSE: FMX
IndustryBeverage, Retail
Founded1890 (1890)
Headquarters
Monterrey
,
Mexico
Area served
Latin America
Key people
José Antonio Fernández
(Chairman)
Eduardo Padilla Silva
(CEO)
Revenue MXN$506.7 billion (2019)
MXN$28.0 billion (2019)
Total assets MXN$637.5 billion (2019)
Number of employees
+230,000
DivisionsCoca-Cola FEMSA
FEMSA Comercio
FEMSA Negocios Estrategicos
Websitewww.femsa.com/en

FEMSA reported revenues of US$26.9 billion for 2019, making it the fifth largest company of Mexico.[1] 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), and for being the owner of the C.F. Monterrey, a Mexican First-Division 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

Cuauhtémoc brewery was established in 1890.[2]

In 1985, Cuauhtémoc merged with Moctezuma to form Cervecería Cuauhtémoc Moctezuma.[2] FEMSA was established from Grupo Visa in 1988.[3]

In 1993, Coca-Cola purchased a 30 percent stake in FEMSA, creating the Coca-Cola FEMSA division.[4]

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.[5]

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 overall.[6]

In September 2011, Coca-Cola FEMSA acquired Grupo Cimsa, a Coke bottler in Morelos, Mexico, Guerrero and Michoacan.[7]

In July 2012, FEMSA announced that it had purchased Lácteos Santa Clara, one of the largest dairy bottlers in Mexico.[8]

On May 29, 2020, FEMSA agreed to pay MXN $8.79 billion in back taxes. Walmart de México y Centroamérica agreed to a similar payment earlier in the same week.[9]

FEMSA Divisions

FEMSA is divided into four business units:

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. Coca-Cola FEMSA distributes about 10% of the worldwide production of Coca-Cola products. This makes it, after Coca-Cola Enterprises the second largest Coca-Cola bottler in the world.

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.[10] 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.[11]

FEMSA Comercio

FEMSA Comercio operates OXXO, the leading convenience store chain in Mexico and a growing portfolio of other small-format retail chains in Latin America, as well as a network of retail service stations for fuel, lubricants and car care products in Mexico.[12]

Investment in the Beer Industry

FEMSA Cerveza previously owned Cervecería Cuauhtémoc Moctezuma, the second largest brewer in Mexico, just after Grupo Modelo.

Since January 2006, FEMSA also owned 68% of FEMSA Cerveja Brasil, a South American brewery founded in 1982 in Brazil as "Cervejarias Kaiser."[13] By 2005 the brewery had 8.7% of the market share in Brazil with annual production of 2,500 million litres. The brand was bought by Molson in 2002. Following the sale to FEMSA, Molson retained 15% of the company along with a seat on the board.[14]

FEMSA Negocios Estratégicos

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

Solistica

Solistica is in charge of the primary distribution (from production points to warehouses) of both Coca-Cola FEMSA and Heineken, as well as product delivery from warehouse to sales location for FEMSA Comercio. It is also in charge of repairing and maintaining all of FEMSA's motorized vehicles. Solistica functions through operational bases, relief bases and cross-docks, and warehouses that are located throughout the country, and currently expanding into South America. It also provides logistics services to third parties.

Imbera

Imbera, formerly known as Vendo de México, S.A. de C.V. (VENDO), is the #1 global commercial refrigeration manufacturer in the world. With facilities in Mexico, Colombia, and Brazil, Imbera exports to 45 different countries and maintains alliances in Argentina, Turkey, Pakistan, and the Philippines. In addition, Imbera has sales offices in 8 countries and provides equipment maintenance in 9, including the US and Canada.[15]

Plásticos Técnicos Mexicanos (PTM)

PTM provides solutions 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.[16]

Subsidiaries

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.[17] Operations within the United States remain in the hands of the original business owners.[18] The company operates as a subsidiary of Femsa Comercio S.A. de C.V.[19] As of 2017 the company claims more than 200 restaurants in 60 Mexican cities and towns.[20][21] 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.[20]

See also

References
  1. "Top 10 del Ranking 2014". CNN Expansión. Archived from the original on 2014-06-27. Retrieved 2014-06-26.
  2. "The History of Cinco de Mayo and Mexican Beer". Home Brew Academy. Retrieved 21 January 2021.
  3. John T. Hyatt. "Mexican Business Culture: Essays on Tradition, Ethics, Entrepreneurship and Commerce and the State". McFarland. Retrieved 21 January 2021.
  4. Tim Golden. "Coke Plans to Buy 30% Stake In Mexican Soft Drink Unit". The New York Times. Retrieved 21 January 2021.
  5. "Bill Gates buys stake in Mexican brewer Femsa". Reuters. 2007-12-21. Retrieved 2019-09-30.
  6. "Heineken agrees Mexican beer deal". BBC News. January 11, 2010. Retrieved May 2, 2010.
  7. Guthrie, Amy. "Mexico's Coca-Cola Femsa to buy bottler Cimsa". MarketWatch. Retrieved 2015-04-12.
  8. "Vía Jugos del Valle, FEMSA toma control del productor de lácteos Santa Clara 2012/07/04 | Excélsior" (in Spanish). Excelsior.com.mx. Retrieved 2017-12-13.
  9. "Pagará FEMSA 8 mil 790 millones de pesos al SAT". aristeguinoticias.com. Retrieved May 30, 2020.
  10. "FEMSA - Corporate Structure". Retrieved 2016-03-30.
  11. Elinor Comlay (29 June 2011). "Mexico's Coca-Cola FEMSA open to more deals". Reuters.com. Retrieved 30 June 2011.
  12. "Oxxo stores are everywhere and they continue to multiply". Mexico News Daily. Retrieved 12 January 2021.
  13. FEMSA Press release - FEMSA Acquires Controlling Stake in Brazilian Brewer Kaiser
  14. Molson Coors Archived 2007-10-11 at the Wayback Machine Press release
  15. "Imbera Cooling". Retrieved 2016-03-30.
  16. "PTM". Retrieved 2016-03-30.
  17. Redacción. "Femsa, adquiere el 80% de "Doña Tota"".
  18. "FEMSA adquiere por 120 mdd a Gorditas Doña Tota".
  19. "Company Overview of Gorditas Dona Tota S.A. de C.V." bloomberg.com. Bloomberg. Retrieved 4 December 2017.
  20. "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.]
  21. "Corporate website". donatota.com. Gorditas Dona Tota. Retrieved 4 December 2017.
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