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Heineken completes Femsa deal

Dutch brewer Heineken has agreed to buy the beer business of Fomento Economico Mexicana SAB (Femsa) for £4.8 billion.

Under the terms of the deal Femsa, the brewer of Sol lager, will take a 20% stake in Heineken.

The acquisition significantly boosts Heineken’s presence in Latin America after previously being heavily reliant on trade the western European market.

Jean-Francois van Boxmeer, Heineken’s chief executive, said: “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.”

Heineken is understood to have beaten off the challenge of SAB Miller in the bidding for Femsa’s beer division.

In order to fund the deal, Heineken will issue 86 million new shares to Femsa when the deal closes, which is anticipated to happen in the second quarter of this year, and a further 29m shares within five years.

Under the terms of the agreement, Heineken will take full control of Femsa’s brewing operations in Mexico as well as the 83% of its Brazilian beer division which it did not already own.

Alan Lodge, 11.01.10

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