M&A: Branching out

Jan 1, 2013

LatAm M&A volume rose slightly in 2012 mostly due to persistent international investor interest – especially from the US – in the region. In many sectors, competition between emerging regional names for investment has driven up prices. A few LatAm corporates continue to look to invest outside of the region. All of these trends, plus the continued selloff by Europeans, look set to carry into this year.

Coca-Cola Femsa joins other LatAm blue-chips looking for strategic acquisitions outside of the region. It intends to pay $689 million in cash to acquire 51% of Coca-Cola Bottlers Philippines from The Coca-Cola Company, in its first buy outside of Latin America.

Analysts said the price was reasonable, at 13 times 2012 Ebitda. Coca-Cola Femsa has an option to acquire the remaining 49% of the bottler for...

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“The crisis has been a setback for reserve diversification."

Jan Dehn, Ashmore Investment Management