Heineken-FEMSA deal progresses

$5.3 billion deal: Heineken's buy-out of FEMSA

Dutch giant to repurchase €100 million in shares

Heineken’s buy-out of FEMSA’s beer arm began today with the opening of a three-month period in which the brewer will buy €100 million of its own shares.

The shares will then be delivered to the Mexican drinks giant as part of the so-called Allotted Share Delivery Instrument (ASDI) that will eventually give FEMSA a 20% stake in Heineken.

The ASDI will see Heineken transferring a total of 29 million allotted shares to FEMSA in two instalments a year over the next five years. In return, Heineken will gain complete control of the company's brewing operations.

The Dutch brewer said today it has appointed a bank to repurchase its shares on the open market in the first phase of the ASDI, which will close at the end of play on June 8th.

The $5.3 billion deal was announced in January. At the time, Heineken CEO Jean-François van Boxmeer said: “It transforms our future in the Americas and marks the next stage in Heineken’s strong association with FEMSA."

FEMSA - owner of the Sol, Tecate and Dos Equis brands - is Mexico’s second largest brewer after Corona-owner Grupo Modelo. The takeover gives the firm the right to appoint two non-executive representatives to Heineken’s board.