FEMSA sells plastics division to AMMI amid industry upheaval
- Fomento Economico Mexicano, S.A.B. de C.V. successfully completed the divestiture of its plastics operations.
- The transaction was valued at 3,165 million pesos and aims to enhance FEMSA's focus on retail and beverage sectors.
- This strategic move aligns with broader sustainability commitments from both FEMSA and AMMI.
In Monterrey, Mexico, on January 3, 2025, Fomento Economico Mexicano, S.A.B. de C.V. (FEMSA) announced the successful closing of the sale of its plastics solutions operations to AMMI, an affiliate of Milenio Capital. The deal was initially disclosed on October 28, 2024, and was finalized for a total of 3,165 million pesos on a cash-free, debt-free basis. This strategic divestiture forms part of FEMSA's ongoing efforts to streamline its business portfolio and focus on its core operations in retail and beverages. FEMSA is known for its extensive operations in the beverage industry through Coca-Cola FEMSA, recognized as the largest franchise bottler of Coca-Cola products worldwide by volume. Additionally, the company has a robust presence in the retail sector, including a health division comprising drugstores and digital financial services initiatives. By divesting its plastics solutions, FEMSA aims to redirect resources toward its rapidly growing sectors, especially those enhancing sustainability and digital financial services. This strategic move reflects a broader trend within multinational corporations to reduce involvement in operations that may not align with sustainability goals. Meanwhile, AMMI, the acquiring company, is notable for its operations including Millfoods, which manufactures non-GMO corn products and serves diverse sectors through a global reach in animal feed and food industries. With an ambitious vision for sustainability, AMMI aspires to achieve carbon neutrality by 2030. As a result, the acquisition aligns with both parties' focus on sustainability and efficient resource management. The successful closing of this divestiture highlights FEMSA's adaptability in a fluctuating market while reinforcing AMMI's position in the food and feed production industries. The deal is expected to strengthen AMMI's portfolio, possibly leading to enhanced product offerings and market reach. Ultimately, such strategic business maneuvers will likely influence market dynamics, prompting competitors to reconsider their operational scopes and sustainability commitments.