Oct. 19 (Bloomberg) -- Jose Antonio Fernandez, chief executive officer of Fomento Economico Mexicano SAB, said his company plans to make “imminent” acquisitions as cash on hand outstrips debt.
“When? I can’t say,” Fernandez said at an event in Monterrey yesterday. “But in the next months or year are we going to buy companies? Definitely, yes. In this sense it’s imminent.”
The company’s Coke bottling unit Coca-Cola Femsa SAB, Latin America’s largest, made two all-share acquisitions earlier this year, which will increase the company’s cash position.
Femsa had $2.7 billion of cash on hand at the end of the second quarter and $1.9 billion of long-term debt, the company reported July 22. Coca-Cola Femsa bought the bottling operations of Grupo Cimsa in a transaction valued at 11 billion pesos ($823 million) on Sept. 19. It acquired the bottling operations of Grupo Tampico SA for 6.55 billion pesos in Coca-Cola Femsa stock on June 28.
The company plans to increase its dividends at a “solid, firm pace,” Fernandez said.
Femsa plans to expand Oxxo, its convenience store chain, beyond Mexico and Colombia, he said, with Brazil being a possible target.
“The trick is to understand the needs of the local market and adapt to those,” he said.
--Editors: Jonathan Roeder, Mike Millard
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