FEMSA
Encyclopedia
FEMSA is the largest beverage company in Mexico
Mexico
The United Mexican States , commonly known as Mexico , is a federal constitutional republic in North America. It is bordered on the north by the United States; on the south and west by the Pacific Ocean; on the southeast by Guatemala, Belize, and the Caribbean Sea; and on the east by the Gulf of...

 and in Latin America
Latin America
Latin America is a region of the Americas where Romance languages  – particularly Spanish and Portuguese, and variably French – are primarily spoken. Latin America has an area of approximately 21,069,500 km² , almost 3.9% of the Earth's surface or 14.1% of its land surface area...

 and as of September 2011 also the largest independent Coca-Cola
Coca-Cola
Coca-Cola is a carbonated soft drink sold in stores, restaurants, and vending machines in more than 200 countries. It is produced by The Coca-Cola Company of Atlanta, Georgia, and is often referred to simply as Coke...

 bottler in the world. FEMSA originated as the Cuauhtémoc Brewery in 1890, which, through debt management, was restructured as FEMSA in 1988. It is based in Monterrey
Monterrey
Monterrey , is the capital city of the northeastern state of Nuevo León in the country of Mexico. The city is anchor to the third-largest metropolitan area in Mexico and is ranked as the ninth-largest city in the nation. Monterrey serves as a commercial center in the north of the country and is the...

, Mexico.

FEMSA purchased the Kaiser Brewery in 2006, renaming it FEMSA Cerveja Brasil. FEMSA is the parent company of the world's second largest bottler of Coca-Cola
Coca-Cola
Coca-Cola is a carbonated soft drink sold in stores, restaurants, and vending machines in more than 200 countries. It is produced by The Coca-Cola Company of Atlanta, Georgia, and is often referred to simply as Coke...

, Coca-Cola FEMSA, S.A. de C.V., and operates OXXO
OXXO
OXXO is a primarily-franchised chain of convenience stores from Mexico, with over 7,000 stores across Latin America. It is the largest chain of this kind of store in Mexico. It is wholly owned by the beverage company FEMSA...

, the largest and most profitable convenience store chain in Latin America. The company is also the owner of C.F. Monterrey, a Mexican soccer team in the Mexican Premier Soccer League.

In January 2010, Heineken International announced it will acquire the beer operations of FEMSA. This transaction will not involve cash, Heineken will pay FEMSA with shares. FEMSA will be one of the major shareholders of Heineken (just after the Heineken family) with 20% of the shares. Advising FEMSA on the deal was international law firm Freshfields Bruckhaus Deringer.

Origins

FEMSA's roots can be traced back to the foundation of Cervecería Cuauhtémoc
Cuauhtémoc Moctezuma Brewery
Cuauhtémoc-Moctezuma Brewery is a major brewery based in Monterrey, Nuevo León, Mexico, founded in 1890...

 in 1890 by Isaac Garza Garza, Francisco Sada Muguerza, José Muguerza, and José María Schneider. Cervecería Cuauhtémoc was close to bankruptcy when its founders were forced to leave the country, after the brewery was taken over by Villistas and Carrancistas during the Mexican Revolution
Mexican Revolution
The Mexican Revolution was a major armed struggle that started in 1910, with an uprising led by Francisco I. Madero against longtime autocrat Porfirio Díaz. The Revolution was characterized by several socialist, liberal, anarchist, populist, and agrarianist movements. Over time the Revolution...

 in 1910.

By 1936 the Garza and Sada families owned two interrelated groups, the Cervecería Cuauhtémoc and the Vidriera Monterrey. In 1936 both families decided to reorganize their stock holdings through the creation of Valores Industriales S.A. (later known as FEMSA) as a holding company to control both families' shares, especially Cervecería Cuauhtémoc and FAMOSA (Fábricas Monterrey, S.A.).

In 1988, after restructuring the company's debt, FEMSA (Fomento Económico Mexicano, S.A. de C.V.), the main subsidiary of VISA, was constituted by Eugenio Garza Lagüera
Eugenio Garza Lagüera
Eugenio Garza Lagüera was a Mexican businessman and philanthropist who served as chairman of the board of the Monterrey Institute of Technology and Femsa; Latin America's largest beverage corporation...

, bringing together the beer, packaging, soft-drink and retail companies.

1) Coca-Cola FEMSA

FEMSA owns 53.7% of the world's second largest bottler of Coca Cola, Coca-Cola FEMSA, S.A. de C.V. ("KOF"), which operates in 9 countries covering the metropolitan area of Mexico City, southeast Mexico, Central America and South America.

Coca-Cola FEMSA is the anchor bottler
Anchor bottler
Anchor bottler is a term used by cola beverage manufacturers for their major bottlers around the world.The Coca-Cola Company employed the strategy of "anchor bottlers" to penetrate markets like China, Eastern Europe and Russia....

 of Coca-Cola
Coca-Cola
Coca-Cola is a carbonated soft drink sold in stores, restaurants, and vending machines in more than 200 countries. It is produced by The Coca-Cola Company of Atlanta, Georgia, and is often referred to simply as Coke...

 and its related soft drink
Soft drink
A soft drink is a non-alcoholic beverage that typically contains water , a sweetener, and a flavoring agent...

 products in much of Latin America
Latin America
Latin America is a region of the Americas where Romance languages  – particularly Spanish and Portuguese, and variably French – are primarily spoken. Latin America has an area of approximately 21,069,500 km² , almost 3.9% of the Earth's surface or 14.1% of its land surface area...

. The company is an important part of the Coca-Cola System. Specifically, Coca-Cola FEMSA distributes about 10% of the worldwide production of Coca-Cola products. This makes it, after Coca-Cola Enterprises
Coca-Cola Enterprises
Coca-Cola Enterprises is a marketer, producer, and distributor of Coca-Cola products. It is the anchor bottler for Western Europe, and was formerly the anchor bottler for most of North America....

 the second largest Coca-Cola bottler in the world.

The company is owned 53.7% by FEMSA, 31.6% by the Coca-Cola Company and the remaining interest trades on the New York Stock Exchange
New York Stock Exchange
The New York Stock Exchange is a stock exchange located at 11 Wall Street in Lower Manhattan, New York City, USA. It is by far the world's largest stock exchange by market capitalization of its listed companies at 13.39 trillion as of Dec 2010...

 and the Mexico City Stock Exchange. The company is headquartered in Monterrey
Monterrey
Monterrey , is the capital city of the northeastern state of Nuevo León in the country of Mexico. The city is anchor to the third-largest metropolitan area in Mexico and is ranked as the ninth-largest city in the nation. Monterrey serves as a commercial center in the north of the country and is the...



The company is the bottler of Coca-Cola in most of Mexico (including Mexico City, Oaxaca, Tabasco, Guanajuato, Veracruz, Puebla and Michoacan) the Buenos Aires
Buenos Aires
Buenos Aires is the capital and largest city of Argentina, and the second-largest metropolitan area in South America, after São Paulo. It is located on the western shore of the estuary of the Río de la Plata, on the southeastern coast of the South American continent...

 region of Argentina
Argentina
Argentina , officially the Argentine Republic , is the second largest country in South America by land area, after Brazil. It is constituted as a federation of 23 provinces and an autonomous city, Buenos Aires...

, São Paulo
São Paulo
São Paulo is the largest city in Brazil, the largest city in the southern hemisphere and South America, and the world's seventh largest city by population. The metropolis is anchor to the São Paulo metropolitan area, ranked as the second-most populous metropolitan area in the Americas and among...

 and other areas of Brazil
Brazil
Brazil , officially the Federative Republic of Brazil , is the largest country in South America. It is the world's fifth largest country, both by geographical area and by population with over 192 million people...

, greater Guatemala City
Guatemala City
Guatemala City , is the capital and largest city of the Republic of Guatemala and Central America...

, Guatemala
Guatemala
Guatemala is a country in Central America bordered by Mexico to the north and west, the Pacific Ocean to the southwest, Belize to the northeast, the Caribbean to the east, and Honduras and El Salvador to the southeast...

, most of Colombia
Colombia
Colombia, officially the Republic of Colombia , is a unitary constitutional republic comprising thirty-two departments. The country is located in northwestern South America, bordered to the east by Venezuela and Brazil; to the south by Ecuador and Peru; to the north by the Caribbean Sea; to the...

, and all of Costa Rica
Costa Rica
Costa Rica , officially the Republic of Costa Rica is a multilingual, multiethnic and multicultural country in Central America, bordered by Nicaragua to the north, Panama to the southeast, the Pacific Ocean to the west and the Caribbean Sea to the east....

, Ecuador
Ecuador
Ecuador , officially the Republic of Ecuador is a representative democratic republic in South America, bordered by Colombia on the north, Peru on the east and south, and by the Pacific Ocean to the west. It is one of only two countries in South America, along with Chile, that do not have a border...

, Nicaragua
Nicaragua
Nicaragua is the largest country in the Central American American isthmus, bordered by Honduras to the north and Costa Rica to the south. The country is situated between 11 and 14 degrees north of the Equator in the Northern Hemisphere, which places it entirely within the tropics. The Pacific Ocean...

, Panama
Panama
Panama , officially the Republic of Panama , is the southernmost country of Central America. Situated on the isthmus connecting North and South America, it is bordered by Costa Rica to the northwest, Colombia to the southeast, the Caribbean Sea to the north and the Pacific Ocean to the south. The...

, Peru
Peru
Peru , officially the Republic of Peru , is a country in western South America. It is bordered on the north by Ecuador and Colombia, on the east by Brazil, on the southeast by Bolivia, on the south by Chile, and on the west by the Pacific Ocean....

 and Venezuela
Venezuela
Venezuela , officially called the Bolivarian Republic of Venezuela , is a tropical country on the northern coast of South America. It borders Colombia to the west, Guyana to the east, and Brazil to the south...

. This represents 40% of the population of Latin America.

In 2003 the company distributed 1.8 billion unit cases of soft drinks. A unit case is 24 8 oz servings (roughly 5.678 liters). The company also distributes beer
Beer
Beer is the world's most widely consumed andprobably oldest alcoholic beverage; it is the third most popular drink overall, after water and tea. It is produced by the brewing and fermentation of sugars, mainly derived from malted cereal grains, most commonly malted barley and malted wheat...

 and bottled water in some of its territories.

On December 19, 2006, Coca-Cola FEMSA announced their attempt to buy out Mexican juice producer Jugos Del Valle.

On 29 June 2011, was announced that FEMSA will merge to the bottling division of Grupo Tampico
Grupo Tampico
Grupo Tampico is one of the largest companies in northeastern Mexico. It is located in Tampico, Tamaulipas. Grupo Tampico's main products are Coca-Cola, automobiles and tourism services.-History:...

, agreeing to pay $9.3 billion pesos
Mexican peso
The peso is the currency of Mexico. Modern peso and dollar currencies have a common origin in the 15th–19th century Spanish dollar, most continuing to use its sign, "$". The Mexican peso is the 12th most traded currency in the world, the third most traded in the Americas, and by far the most...

 ($790 million dollars
United States dollar
The United States dollar , also referred to as the American dollar, is the official currency of the United States of America. It is divided into 100 smaller units called cents or pennies....

) in stock for the Coke
Coca-Cola
Coca-Cola is a carbonated soft drink sold in stores, restaurants, and vending machines in more than 200 countries. It is produced by The Coca-Cola Company of Atlanta, Georgia, and is often referred to simply as Coke...

 bottling operations of Grupo Tampico.

2) FEMSA Comercio

FEMSA Comercio operates OXXO
OXXO
OXXO is a primarily-franchised chain of convenience stores from Mexico, with over 7,000 stores across Latin America. It is the largest chain of this kind of store in Mexico. It is wholly owned by the beverage company FEMSA...

, the largest convenience store chain in Latin America, as well as other smaller convenience stores called “deposits”.

3) FEMSA Cerveza

FEMSA Cerveza owns Cervecería Cuauhtémoc Moctezuma, the second largest brewer in Mexico, just after Grupo Modelo
Grupo Modelo
Grupo Modelo is a large brewery in Mexico, It has 63% of the Mexican beer market, and exports beer to the United Kingdom, United States and Canada . Its export brands include Corona, Modelo, and Pacífico...

, and produces well-known Mexican beers like Tecate, Sol, Dos Equis, Indio, and Kloster.

Since January 2006 FEMSA have owned 68% of FEMSA Cerveja Brasil, a South American brewery
Brewery
A brewery is a dedicated building for the making of beer, though beer can be made at home, and has been for much of beer's history. A company which makes beer is called either a brewery or a brewing company....

 founded in 1982 in Brazil
Brazil
Brazil , officially the Federative Republic of Brazil , is the largest country in South America. It is the world's fifth largest country, both by geographical area and by population with over 192 million people...

 as "Cervejarias Kaiser". 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
Molson
Molson-Coors Canada Inc. is the Canadian division of the world's fifth-largest brewing company, the Molson Coors Brewing Company. It is the second oldest company in Canada after the Hudson's Bay Company. Molson's first brewery was located on the St...

 in 2002. Following the sale to FEMSA, Molson will retain 15% of the company along with a seat on the board.

The company brews a range of lager
Lager
Lager is a type of beer made from malted barley that is brewed and stored at low temperatures. There are many types of lager; pale lager is the most widely-consumed and commercially available style of beer in the world; Pilsner, Bock, Dortmunder Export and Märzen are all styles of lager...

s under the brand names Bavaria, Kaiser and Sol. Other beers are Xingu, Palma Louca and Bavaria Pilsen.

In addition, FEMSA Cerveza produces glass bottles, aluminum cans and crown caps.

On January 11, 2010, the Dutch
Netherlands
The Netherlands is a constituent country of the Kingdom of the Netherlands, located mainly in North-West Europe and with several islands in the Caribbean. Mainland Netherlands borders the North Sea to the north and west, Belgium to the south, and Germany to the east, and shares maritime borders...

 brewing company Heineken International announced it would do a joint-venture with the beer activities of FEMSA making of them Global Leaders.

4) FEMSA Insumos Estratégicos

FEMSA Insumos Estratégicos is designed to drive the business units’ development through quality products and services such as refrigeration, distribution and information solutions, among others. It is subsequently divided into:

a) FEMSA Logística

FEMSA Logística is in charge of the primary distribution (from production points to warehouses) of both Coca Cola FEMSA and FEMSA Cerveza products, 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. FEMSA Logística functions through operational bases, relief bases and cross-docks, and warehouses that are strategically located throughout the country, and currently expanding into South America. It also provides logistics services to third parties.

b) FEMSA Empaques

FEMSA Empaques is in charge of designing and creating the bottles, as well as labels, for Cervecería Cuauthémoc Moctezuma products as well as refrigerators, and other promotional products. FEMSA Empaques operates 5 production plants: Silice del Itsmo, S.A. de C.V. (SISA); Vendo de México, S.A. de C.V. (VENDO); Plásticos Técnicos Mexicanos, S.A. de C.V.; Grafo Regia, S.A. de C.V.; and Quimiproductos, S.A. de C.V.

Since 1995, José Antonio Fernández
José Antonio Fernández
José Antonio Fernández Carbajal is a Mexican businessman. He is the chairman and CEO of FEMSA, the largest beverage company in Latin America...

 has been the General Director of FEMSA. In 2001, José Antonio Fernández
José Antonio Fernández
José Antonio Fernández Carbajal is a Mexican businessman. He is the chairman and CEO of FEMSA, the largest beverage company in Latin America...

 was elected as Chairman of the Board and of FEMSA.

Cascade Investments LLC

On December 20, 2007, Cascade Investments LLC
Cascade Investments LLC
Cascade Investment, L.L.C. is an American investment company headquartered in Kirkland, Washington, United States. It is controlled by Bill Gates....

, whose main partner is Bill Gates
Bill Gates
William Henry "Bill" Gates III is an American business magnate, investor, philanthropist, and author. Gates is the former CEO and current chairman of Microsoft, the software company he founded with Paul Allen...

, announced it will invest 390 million dollars in FEMSA. FEMSA's President Jose Antonio Fernandez said in a statement about the news: "This type of decision on the part of large investment funds is a show of recognition and confidence in our company's performance,".

External links

FEMSA Official Webpage
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