FEMSA expands its distribution footprint in the East Coast of the United States

Rhea-AI Summary

Fomento Económico Mexicano (FMX) announced the acquisition of Daycon Products Co., a specialized distribution company based in Maryland. This strategic move, expected to close in Q3 2021, will expand FEMSA's distribution footprint along the U.S. East Coast, enhancing its national distribution platform. Daycon generated approximately $75 million in revenue over the past year, contributing significantly to FEMSA's growth strategy.

Positive

• Acquisition of Daycon Products Co. enhances FEMSA's distribution capabilities on the U.S. East Coast.
• Daycon generated approximately $75 million in revenue over the last twelve months.

Negative

• None.

MONTERREY, Mexico, Aug. 31, 2021 (GLOBE NEWSWIRE) -- Fomento Económico Mexicano, S.A.B. de C.V. (“FEMSA” or the “Company”) (NYSE: FMX; BMV: FEMSAUBD, FEMSAUB) announced today that Envoy Solutions, FEMSA’s specialized distribution subsidiary in the United States, reached an agreement to acquire Daycon Products Co. (“Daycon”), an independent specialized distribution company based in Upper Marlboro, Maryland. Daycon will further expand and strengthen FEMSA’s distribution footprint along the East Coast of the United States, including Washington D.C. and the states of Virginia, West Virginia, Maryland, Delaware, New Jersey and Pennsylvania. This transaction represents another important step in FEMSA’s strategic path to build a leading national distribution platform in the United States. Revenues of the acquired business for the last twelve months as of June 2021, were approximately US$ 75 million.

This transaction is subject to customary closing conditions and approvals and is expected to close during the third quarter of 2021.

About FEMSA
FEMSA is a company that creates economic and social value through companies and institutions and strives to be the best employer and neighbor to the communities in which it operates. It participates in the retail industry through FEMSA Comercio, comprising a Proximity Division operating OXXO, a small-format store chain, a Health Division, which includes drugstores and related activities, and a Fuel Division, which operates the OXXO Gas chain of retail service stations. In the beverage industry, it participates through Coca-Cola FEMSA, the largest franchise bottler of Coca-Cola products in the world by volume; and in the beer industry, as the second largest shareholder of Heineken, one of the world’s leading brewers with operations in over 70 countries. FEMSA also participates in the logistics and distribution industry through its Strategic Business Unit, which additionally provides point-of-sale refrigeration and plastic solutions to its business units and third-party clients. Across its business units, FEMSA has more than 320,000 employees in 13 countries. FEMSA is a member of the Dow Jones Sustainability MILA Pacific Alliance, the FTSE4Good Emerging Index and the Mexican Stock Exchange Sustainability Index, among other indexes that evaluate its sustainability performance.

FAQ

What is the significance of FMX's acquisition of Daycon Products Co.?

The acquisition of Daycon will expand FEMSA's distribution footprint along the East Coast, enhancing its national distribution platform.

How much revenue did Daycon Products Co. generate before the acquisition by FMX?

Daycon Products Co. generated approximately $75 million in revenue over the last twelve months.

When is the acquisition of Daycon Products by FMX expected to close?

The acquisition is expected to close during the third quarter of 2021.

In which states will FMX expand through the acquisition of Daycon?

FMX will expand in Virginia, West Virginia, Maryland, Delaware, New Jersey, Pennsylvania, and Washington D.C.