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One of the least talked about existing partnerships between two global beer cos turned into a much bigger deal, but with a twist for US mkt. Over 20 yrs after taking 25% stake in co (in 2002), Heineken will buy rest of Florida Ice and Farm Co (FIFCO) beer/bev/food biz - Distribuidora La Florida - in Costa Rica and beyond, as well as remaining stake in FIFCO's Panama biz, 75% stake in its Nicaragua Brewing Holding (JV), and 100% stake in its Mexico beyond beer biz. Heineken's spending $3.2 bil for deal implying acquisition multiple of 11.6X EV/EBITDA based on co's 2024 results, expected to close in first half of 2026, announcement notes. Yet FIFCO USA explicitly is not included in the transaction, both Heineken and FIFCO USA noted in separate communications, leaving co to explore "strategic alternatives." FIFCO "is actively exploring opportunities to enhance the operation through synergies that could integrate FIFCO USA into a broader ecosystem," FIFCO USA ceo Gustavo Cornejo wrote in letter to distrib partners. "These opportunities may include one or more strategic alliances that complement existing capabilities and accelerate the growth and development of this business unit," he went on. "FIFCO has expressed its clear intention to pursue alternatives that ensure the long-term viability of FIFCO USA and remains committed to keeping all stakeholders informed as the process moves forward." And "in the meantime, FIFCO USA will continue operating business as usual, with no immediate changes expected," he underscored.Heineken Not Interested in US Biz? FIFCO USA Down 12% YTD in Scans; Doubled Down on Rochester Facility Readthru appears to be that Heineken ain't interested in FIFCO USA. That biz has been particularly challenged in recent yrs after Seagram's Escapes FMBs hit a wall. Volume gradually declined thruout FIFCO's time in US after acquiring North American Breweries, shedding close to 1 mil bbls of own-brand volume from 2013 thru 2024, INSIGHTS estimates. This yr sales are down 12% to $227.1 mil from 8.7 mil cases YTD thru Sep 7 in Circana multi-outlet + convenience data with Seagram's Escapes down 20% to $84 mil, Labatt beer fam down 7% to $98 mil and all others (primarily Genesee and Lipton Hard Iced Tea) down 7%.Yet FIFCO recently doubled down on co's production and copacking capabilities in Rochester, NY, investing $50 mil into new hi-speed canning line and other additional tanks/equipment to support onboarding of Labatt volume previously produced by MC in Canada. On its website, FIFCO USA notes that it's "always looking for new contract manufacturing partners who need a supplier to help produce over 500,000 cases of product annually," offering everything from beer to non-alc beer, non-alc bevs, FMB/sugar-based alc bevs, wine, grain neutral spirits and "other." Gotta wonder which strategic brewers in the US or abroad would be interested; most US-based cos have too much capacity rather than too little these days.Costa Rica Adds 2.5 Mil hLs in Beer/Beyond Beer, 2.5 Mil hLs of NAs as Pepsi Bottler FIFCO's Costa Rica biz is truly dominant in beer, and a solid #2 in non-alc bevs thru Pepsi bottling biz. Its beer biz sells approximately 2 mil hLs (~1.7 mil bbls) of beer, 0.5 mil hLs (~426K bbls) of beyond beer and 2.5 mil hLs (~2.1 mil bbls) of non-alc bevs thru bottling license with PepsiCo, Heineken announcement highlights. It also touted co's "well-positioned adjacent business" in wine & spirits distribution, "staple foods, and a retail business with more than 300 proximity outlets." The total Distribuidora La Florida operations netted $1.132 bil USD in net revs, $334 mil EBITDA and $278 mil oper profit in 2024 (excluding FIFCO USA). Indeed, "the Costa Rica business is expected to unlock revenue and cost synergies" and altogether co expects to reach a "run-rate cost savings of approximately US$50 million," Heineken added, noting that Costa Rica will become one of the global brewer's "top 5 operating companies by operating profit." Post transaction, Heineken net debt is expected to increase by 3.2 bil euros ($3.8 bil USD) and net debt/EBITDA ratio to increase "modestly." But co's "committed" to returning to long-term target of below 2.5X. All told, Heineken keeps investing most in its international biz while Heineken USA remains challenged.

Heineken to Buy Rest of FIFCO's Beer/Bev Biz, Except in US, for $3.2 Bil; FIFCO "Exploring Strategic Alternatives" for US

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