Oxxo: In addition to Mexico, in which other countries are FEMSA’s convenience stores located?

The Oxxo are stores belonging to FEMSA. REUTERS/Daniel Becerril

Last Wednesday, February 15, the company Fomento Económico Mexicano (FEMSA) announced that, within a period of two to three years, it will place its shares in Heineken on the market, which are equivalent to 14% of the Dutch beer, and will use the resources to pay part of its debt and finance its future growth through greater capital investments (CAPEX).

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FEMSA reported that it plans to bring its convenience stores to the neighboring country to the north, in addition to accelerating its expansion in South America.

Through a statement posted on its website, FEMSA reported that it “announced today that its Board of Directors approved a new long-term plan to maximize value creation, as well as certain decisions derived from its strategic review.” .

After an analysis carried out last year, the company, which among other businesses manages the Oxxo stores, considered that the best way to maximize long-term value creation is to “focus on its key business verticals.”

FEMSA approved divestment in Heineken to pay debt

The Mexican company will place its shares in the Dutch brewery on the market

According to his explanation, the divestment in Heineken is subject to market conditions and the directors appointed by FEMSA will resign from the Heineken Boards. “FEMSA will explore strategic alternatives for Envoy Solutions, as well as for its other minority investment and other non-core and non-strategic business units. FEMSA will reduce its existing debt to achieve leverage of approximately 2x Net Debt/EBITDA ex-KOF1, in order to maintain a strong investment grade credit rating. Capital in excess of what is required for organic and inorganic growth of our main business verticals will be returned to FEMSA shareholders over time.”

It was recently reported that FEMSA is considering taking the Oxxos to the United States. Photo: Femsa.

After this announcement, days later the company announced that it plans to bring Oxxo stores to the United States (USA), in addition to contemplating expanding its store model without checkouts and with artificial intelligence, said Daniel Rodríguez Cofre, general director of the company. .

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Rodríguez Cofre highlighted that, only in Mexico, they continue to see many opportunities for the growth of Oxxo, which is why they believe that they will be able to continue with growth rates of between 800 and a thousand units per year.

“The divestment in Heineken will provide resources, but it will also free it from regulatory restrictions on its intentions to boost the retail business in the United States market,” said Rodríguez Cofre.

And it is that currently, Oxxo is one of FEMSA’s most profitable businesses. These convenience stores are not only found in Mexico, but they can also be found in other countries, so if they arrived in the United States, it would not be the first foreign country to receive them.

Fomento Económico Mexicano (FEMSA) recently sold its shares in Heineken. REUTERS/Daniel Becerril

In 2009, Oxxo opened its first store outside of Mexico. The first foreign country in which this chain of convenience stores was established was Colombia, a country in South America. By mid-2022, it already had a standard of 190 stores, although local media reported that in October, the chain already had 205 stores.

Peru is added to Colombia, a country where Oxxo arrived in 2018. By January 2023, the company already had at least 78 branches in the South American country.

After Mexico, Brazil is the country with the largest market for Oxxo, since after FEMSA’s alliance with Grupo Nós, in 2020, Oxxo was able to open 250 stores under this name. In addition, there are 1,162 operated under the Shell Select brand.

Chile is another of the Latin American nations where Oxxo can already be found. According to the 2021 annual report, published in April 2022, the company at that time already had at least 122 stores.

In October 2022, FEMSA completed the purchase of the Valora chain, which has close to 2,700 points of sale distributed in various European nations: Switzerland, Germany, Austria, Luxembourg and the Netherlands. By strategy, it was decided that they continue operating under the original name of the stores.

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