This year, Heineken acquired the beer business of Latin American brewer FEMSA, a move that has transformed Heineken's presence in The Americas and made it the world's second- largest brewer in terms of revenue. Operating as Cerveceria Cuauhtémoc Moctezuma (CCM) in Mexico and as Heineken Brasil in Brazil, the new businesses have a successful portfolio of brands, including Dos Equis, Tecate, Sol and Kaiser. So what synergies can Heineken deliver from the deal, and where does the potential lie? World ofHeineken 42 summer 2010 A quick search on the Internet and it's clear that Regional Director The Americas, John Nicolson's views on the acquisition are being echoed by analysts around the globe: "The deal provides a unique opportunity to drive growth in three of the world's four biggest beer profit pools, accessing both value and volume growth in Mexico - the world's fourth- largest beer profit pool - and strengthening Heineken's leading position in the highly profitable and growing Hispanic segments in the US. It will also lead to a value creation opportunity in Brazil, the world's second- largest beer profit pool. "FEMSA's established routes to market offer significant scope to accelerate the growth of the Heineken brand in the premium segment in both Mexico and Brazil," continues John. "With a 43% market share in Mexico, the move positions Heineken as the number two beer company in the country, behind Grupo Modelo. It also makes Heineken a major player in Brazil, the second-largest beer market by profit. Our already leading international portfolio will be strengthened further with the addition of, among others, the Dos Equis, Tecate, Sol and Kaiser brands." The move will reduce Heineken's reliance on mature markets, such as Western Europe, by increasing its exposure to growth from the developing markets in Latin America. Analysts estimate that once the deal is complete, Heineken will have 40% of its EBIT in growing markets. RAPIDLY GROWING MARKET Mexico has become Heineken's biggest volume market worldwide. Analysts forecast the Mexican beer market will grow many times faster than in other parts of the world. Heineken CEO, Jean-Franpois van Boxmeer, has a positive take on the strong competition in Mexico: "We believe that it would help the market if the players start segmenting it more, instead of just copying each other and competing on price." A selection of Heineken's newly acquired brands 7

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World of Heineken | 2010 | | pagina 9