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In dutch…

12 January 2010

Ever since Grupo Modelo’s takeover by Anheiser-Busch, FEMSA beer sales have been plummeting..  Coupled with the humongous debt from FEMSA’s Coca-Cola purchases, the company was leaking money, and the Dutch boys were there to stick their finger in the financial dike.  Reuters has the fullest coverage in English.  Highlights:

AMSTERDAM/BRUSSELS (Reuters) – Heineken NV will buy the beer business of Mexico’s FEMSA in a $5.7 billion deal that boosts the Dutch brewer’s emerging-markets presence and cements an alliance with one of Latin America’s biggest drinks firms.

[Heinekin] shares rose 3 percent… FEMSA shares (FMSAUBD.MX) slid 13.61 percent on disappointment over the deal price after brewer SABMiller (SAB.L) pulled out of the auction. SAB was not interested in FEMSA’s Brazil operations, sources told Reuters.

FEMSA, which started as a brewer and ice maker in 1890, is the world’s second-biggest Coca-Cola  bottler, and sells the soft drink in nine Latin American countries. …

FEMSA’s beer unit, [is] home to Dos Equis, Tecate and Sol…

The company operates OXXO, one of the fastest-growing convenience store chains in the region. It has 7,000 units in Mexico and recently expanded into Colombia.

Heineken would secure an operation with 43 percent of the Mexican beer market and a 9 percent share in Brazil. The United States is the most profitable beer market, Heineken said. Brazil is second and Mexico is fourth.

FEMSA will remain listed on the Mexican stock exchange and end 2010 with no debt… The company’s free-cash flow generation will also help bring Coca-Cola FEMSA’s debt close to zero, he added.

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