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Coca-Cola Femsa to acquire Brazil's Vonpar in $1.09bn deal

DBR Staff Writer Published 26 September 2016

Coca-Cola Femsa has agreed to acquire buy Brazilian beverage firm Vonpar in a cash, stock and debt deal valued at R3.5bn ($1.09bn).

Coca-Cola Femsa that its Brazilian unit Spal Industria Brasileira de Bebidas will pay R1.73bn ($532m) to Vonpar's owners as well as another R688m ($211m) that will be converted into Coca-Cola Femsa shares.

It will also issue a convertible three-year debt of R$1.09bn ($335m) to the owners of Vonpar.

Through the acquisition, Coca-Cola FEMSA is expecting to make R$65m ($20m) at the EBITDA in the next 18 to 24 months.

According to the company, it will expand its reach to about 88 million consumers, which is 43% of Brazilian population and 54% of its GDP through the combined territories post acquisition.

It also expects to increase its volume by 25% in Brazil while getting access to 49% of the Coca-Cola system’s volume there.

Coca-Cola FEMSA CEO John Santa Maria said: “We are confident that Vonpar’s talented group of professionals, and their track record of performance, coupled with their social and environmental commitment, will positively impact our combined operations going forward.”

The largest Coca Cola bottler in Latin America said that Vonpar’s footprint which borders its own operations in southern Brazilian state of Paraná is a perfect geographic fit.

Maria also said: “The strategic geographic location and joint operational opportunities of this franchise will enable us to capture significant synergies and economies of scale.”

In the financial year that ended on June 30, 2016, Vonpar generated net revenue of R$2.02bn ($622m) after selling 190 million unit cases of beverages which also includes 23 million unit cases of beer.

Considered as one of the largest privately owned bottlers in the Brazilian Coca-Cola system, Vonpar has three bottling facilities and five distribution centers, and employs around 4,000 people.

Operating in the states of Rio Grande do Sul and Santa Catarina, Vonpar claims to serve more than 15 million consumers.

Image : Coca-Cola FEMSA through its Brazilian subsidiary Spal will acquire Vonpor. Photo : courtesy of THE COCA-COLA COMPANY.