Mexico’s Arca Continental to Bottle, Distribute Coca-Cola in Southwest U.S.

5/26/16 Wall Street Journal 

14716049305_62495b73a5_bCoca-Cola Co. said Wednesday it plans to transfer its soda manufacturing and distribution in Texas and parts of Oklahoma to a joint venture headed by Mexico’s Arca Continental SAB.

The letter of intent with Arca, Coke’s second-largest bottler in Latin America, comes as Atlanta-based Coke accelerates efforts to divest plants and trucks in order to focus on marketing and its more profitable concentrate business.

Arca is the first Mexican bottler to acquire Coke territory in the U.S. but not the first foreign partner. Hong Kong-based Swire Pacific Ltd. is a major Coke bottler and distributor in the Western U.S. and Japan’s Kirin Holdings Co. owns a Coke bottler in the Northeast.

Coke said in February it would sell all of its U.S. manufacturing and distribution by the end of 2017, part of a broader global divestment drive. It paid $12.3 billion in 2010 to acquire the U.S. territories of Coca-Cola Enterprises Inc., its biggest domestic bottler at the time.

With the latest deal, Coke said it has struck deals to refranchise territories representing about 60% of bottler-delivered volume and 41 of 51 cold-fill production plants in the U.S.  Coke still owns bottling and distribution in California and parts of the Northeast, in addition to other territories.

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Mexico’s Busiest M&A Suitor Has a Billion Euros for Fresh Deals

3/22/16 Bloomberg 

Coca-Cola_Femsa_LogoFomento Economico Mexicano SAB bought more companies than any other in Mexico last year while expanding its burgeoning pharmacy business. Now it’s got a billion euros ($1.1 billion) of fresh ammunition.

That’s likely to translate into new acquisitions as the company looks to replicate its success in building Latin America’s largest convenience-store chain and biggest Coca-Cola bottler, according to Corp. Actinver SAB. One possible target: some of Mexico’s 11,000 gas stations. Femsa’s already adding service stations and the industry is on the verge of transformation since the nation junked a state oil monopoly dating back to 1938.

Femsa and its bottling unit, Coca-Cola Femsa SAB, have completed 19 deals worth a total $6.2 billion in the last five years, the most in Latin America among convenience-store, pharmacy or non-alcoholic beverage companies. Femsa’s sale of euro-denominated debt last week reloads the war chest after it bought drug-store chains last year, including Chile’s Farmacias Cruz Verde SA.

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UPDATE 1-Mexico’s Femsa’s 2nd-qtr profit jumps 28 pct on retail unit

7/24/15 Reuters

Mexico consumes more Coca Cola per capita than any other country
Mexico consumes more Coca Cola per capita than any other country

Mexican retailer and bottling company Femsa on Thursday said its second-quarter profit rose 28 percent, driven by growth in its retail division which now includes a new venture into gasoline stations.

The company, which co-owns Coke bottler Coca-Cola Femsa and operates the Oxxo chain of convenience stores, reported a profit of 3.872 billion pesos ($247 million), compared to 3.018 billion pesos in the same quarter a year earlier.

Revenue grew 6 percent to 75.12 billion pesos.

In its retail division, sales increased by 31.4 percent as the company incorporated its new Oxxo gas operations and 258 net new Oxxo stores.

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Coca-Cola And Pepsi Face Serious Security Problems In Guerrero Mexico

07/01/15 Forbes

guerreroNine months after the disappearance of 43 students in the town of Iguala in southwestern Mexico, Coca-Cola KO -0.43% has decided to shutter its facility in the nearby municipality of Arcelia, due to ongoing security problems. As I explained in a recent article for Fusion, “Citing concerns for the safety of its employees, Coca-Cola has decided to permanently shutter a storage facility in Arcelia, Guerrero, laying off 120 workers and eliminating one of the few sources of formal-sector jobs in the area.” Guerrero, the state where Iguala is located, presents a unique security challenge for multi-national companies due to high levels of poverty, low levels of development, and the presence of a noxious mix of organized crime groups, armed citizens militias, and militant student organizations.

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Coca-Cola Launches Mid-Calorie Soda in a Mexico Battling Its Bulge

08/25/14 The Wall Street Journal

Coca-Cola Co. is introducing a mid-calorie cola here in its second-biggest market by sales volume and a country that’s struggling to shed the pounds.

Mexicans drink more Coca-Cola products per capita than consumers in any other country, so the company’s introduction of Coca-Cola Life, sweetened in part by the stevia plant, may be of some importance in a country battling obesity and a rise in diabetes and related health problems.

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Shuttered Coca-Cola Facility Highlights Mexico’s Broader Security Problems

08/12/14 By Nathaniel Parish Flannery. Forbes

Coca Cola BottlesOn July 30 Coca-Cola FEMSA, Latin America’s largest coke bottler shuttered a facility in the Pacific Mexican state of Guerrero, which is home to Acapulco, a city that recorded the country’s highest murder rate in 2013. On August 4 assailants stopped and burned four Coca-Cola trucks on roads near the town of Arcelia.

In 2013 Guerrero’s problems with crime attracted global attention after a group of citizen police patrols including one composed of all women emerged to enforce local law and order in different towns in the state. Overall, Guerrero is one of Mexico’s most problematic states in terms of violence and security. When I visited Acapulco last summer, it was then the most violent city in Mexico.

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Mexico’s Coca-Cola Femsa reports lower second-quarter profit

07/23/14 Reuters

Coca Cola BottlesMexican Coke bottler Coca-Cola Femsa said on Wednesday its second-quarter profit fell 4.6 percent in spite of higher sales as it faced restructuring charges and paid more interest on debt it took on to acquire businesses in Brazil.

Femsa reported a second-quarter profit of 2.68 billion pesos ($206 million), compared to a profit of 2.81 billion pesos in the year-earlier period.

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