The Coca-Cola Company, The Coca-Cola System in Brazil, and HEINEKEN announce redesigned distribution partnership.
This Agreement marks a new milestone in the relationship among the companies.
It re-aligns the interests of all parties for the future and builds on a solid historical foundation.
Mexico City, Mexico – February 24, 2021 – Coca-Cola FEMSA, S.A.B. de C.V. (BMV: KOFUBL; NYSE: KOF) announces that The Coca-Cola Company, the Coca-Cola System in Brazil and HEINEKEN have reached an agreement (the “Agreement”) to redesign their longstanding distribution partnership in Brazil.
As per the Agreement, expected to become effective mid-2021, the parties will begin a smooth transition of the Heineken and Amstel brands to HEINEKEN Brazil’s distribution network. The Coca-Cola System in Brazil will continue to offer Kaiser, Bavaria and Sol, and will complement this portfolio with premium brand Eisenbahn and other international brands. The Agreement allows the parties to better serve consumers and customers in the Brazilian market with a solid portfolio, building on the positive momentum developed over many years of successful collaboration.
Additionally, as part of the redesign of the distribution partnership, the parties will have more flexibility. Subject to certain mutually-agreed upon terms established in the Agreement, the Coca-Cola System in Brazil will be able to produce and distribute alcoholic beverages and other beers in a certain proportion to HEINEKEN’s portfolio and HEINEKEN will be able to explore further opportunities in the non-alcoholic segment. This will allow Brazilian consumers to benefit from a wider array of options.
“The redesign of the Coca-Cola System’s distribution partnership with HEINEKEN in Brazil is an important milestone. We are proud of the market development that we have achieved together, and we are excited to continue leveraging our distribution network in the country with a broad portfolio of leading brands.” John Santa Maria Otazua, Coca-Cola FEMSA’s Chief Executive Officer.
“Our companies have a long partnership history in Brazil, and we are pleased to reach a new agreement that will serve consumers for many years to come.” Luis Felipe Avellar, President Coca-Cola Brazil & South Cone Operations.
“I am very pleased to redefine our distribution partnership with the Coca-Cola System in Brazil. Through a dual route to market, we will be able to reach and better serve our consumers and customers with our broad portfolio, leveraging two strong distribution systems.” Mauricio Giamellaro, Managing Director, HEINEKEN Brazil.
“This new agreement is positive news not only for the parties involved but for our Brazilian clients and consumers as well.” Ricardo Mello, President of the Association of Coca-Cola Bottlers in Brazil.
The parties have agreed to an initial term until December 31, 2026 with automatic renewal for another 5-year term, subject to the terms of the Agreement. The Agreement is subject to customary regulatory approvals. As part of the Agreement, the parties have agreed to end the existing litigation between them relating to the previous distribution agreements.