Coca-Cola Femsa buys Vonpar in Brazil

The business is being conducted by Spal, Femsa’s Brazilian subsidiary, and it still depends on approval by the Administrative Council for Economic Defense (Cade), the body that regulates competition in the country. The transaction value is being estimated at around US$ 1 billion and involves exchange of shares and cash. The Vontobel family, owner of Vonpar, is expected to receive R$ 0.54 billion in cash, US$ 214 million to be converted into Femsa's shares and R$ 0.34 billion to be issued in temporary notes for redemption in three years and that may also be converted into equity.

Vonpar is a company operating mainly in Brazil’s southern states of Rio Grande do Sul and Santa Catarina, where it’s the owner of three bottling plants and five distribution centers. The company has about 4,000 employees and 15 million consumers. In 12 months, the company sold 190 million unit cases of beverages, generating approximately US$ 0.63 billion in net revenues and an EBITDA estimated at US$ 104 million.

With the acquisition, Femsa, which is already present in Mexico, Colombia, Venezuela, Argentina, the Philippines and many countries in Central America, will increase by 25% the volume of bottled beverages it produces in the Brazil, reaching a 49% market share of all Coca Cola products. The synergies to be captured in 18 to 24 months are estimated at US$ 20 million, obtained with a logistics network, optimization of processing capacity, more efficiency in administrative costs and the adoption of Coca-Cola Femsa’s business practices.

Spal Indústria Brasileira de Bebidas was represented by Pinheiro Neto Advogados, while Vonpar and its selling companies were advised by TozziniFreire Advogados.