KOF Adds in Brazil

Mexico’s Coca-Cola Femsa (KOF) has agreed to buy Spaipa, the second-largest privately owned Coca-Cola bottler in Brazil, for $1.86bn cash, it says. The deal follows an agreement for Companhia Fluminense de Refrigerantes in July, and gives KOF a leading share in the Brazilian market, according to brokerage Ve Por Mas, with 40%. The price implies a multiple of 13.8x Ebitda, the shop says, above the 11.2x seen in the Companhia Fluminense deal, though the premium is “justified” given the competitive advantages KOF gains. The buyer plans to finance the purchase with bank debt for which it has already secured formal commitments. Spaipa operates in the states of Sao Paulo and Parana, and generated $905m in revenue in the 12 months to June 30. The deal awaits regulatory approval.