Heineken beats SABMiller to acquire Femsa's beer unit for $7.6 billion

Heineken, one of the world's biggest brewers today agreed to acquire the beer business of Mexico's Fomento Económico Mexicano, S.A.B. de C.V (Femsa) in a all stock deal valued at $7.6 billion in order to create a new avenue for growth in Latin America.

Heineken, based in Amsterdam edged out London-based brewing giant SABMiller Plc in an auction to acquire the beer operations of the largest brewer in Latin America, Monterrey-based  Femsa, in an all stock transaction that values the company at $7.6 billion, including a net debt and pension obligations of $2.1 billion.

Heineken, in turn, will give FEMSA a 20-per cent stake in the Heineken Group making it the second largest shareholder and the right to appoint two non-executive representatives to Heineken's supervisory board.

Jean-François van Boxmeer, chairman and CEO of Heineken

Jean-François van Boxmeer, chairman and CEO of Heineken, said, ''This is a compelling and significant development for Heineken. It transforms our future in the Americas and marks the next stage in Heineken's strong association with FEMSA. Through this deal we become a much stronger, more competitive player in Latin America, one of the world's most profitable and fastest growing beer markets.''

''The acquisition strengthens considerably our position within the global beer market, expands our portfolio of leading international brands and enhances our leading position in the US import market,'' he added.

Heineken, which has a smaller presence in big emerging economies, edged out SABMiller to acquire Femsa, where most analysts had expected the London brewer to easily outbid Heineken, when Femsa put its beer operations for sale in October. Femsa has the second-biggest plant in Mexico and another in Brazil, that is the country's fourth biggest.