Fitch rates Femsa

Fitch Ratings said it has assigned a AAA (mex) credit rating to Femsa SA de CV. In conjunction with this rating action, Fitch has assigned a preliminary rating of AAA (mex) to the proposed issuance by Femsa of about $300 million equivalent of peso-denominated Certificados Bursatiles debt.

Femsa Cerveza SA de CV would have a joint and several obligation (obligado solidario y avalista) for this debt under the proposed structure. Funds from this issuance will be used to acquire the 30% shareholding stake of Femsa Cerveza currently owned by Interbrew for $1.245 billion in cash.

The agreements also include the termination of the existing commercial agreement concerning Femsa's beer brands in the United States and the end of Femsa Cerveza's participation in Labatt USA.

Fitch said the underlying corporate credit rating of Femsa is based upon its solid business position and the strong financial profile of its two most important subsidiaries - Coca-Cola Femsa SA de CV and Femsa Cerveza. The rating is further supported by the low amount of debt at the Femsa holding company level relative to the debt burden of Coca-Cola Femsa and Femsa Cerveza.

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