FEMSA completes Accelerated Share Repurchase Agreement, and announces new Agreement
Fomento Económico Mexicano (FEMSA) announces the completion of a previous Accelerated Share Repurchase (ASR) agreement and the initiation of a new ASR.
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Rhea-AI Summary
Fomento Económico Mexicano (FEMSA) announces the completion of a previous Accelerated Share Repurchase (ASR) agreement and the initiation of a new ASR. The company completed the repurchase of approximately 3.2 million American Depositary Shares (ADSs) at an average price of $123.27 per ADS, totaling $400 million, as of May 28, 2024. FEMSA has now entered into a new ASR to repurchase up to $600 million worth of its ADSs. The number of shares repurchased will be determined based on the daily volume-weighted average price of the ADSs during the agreement period, with the final settlement expected by Q4 2024.
Positive
- Completion of a $400 million ASR, repurchasing 3.2 million ADSs.
- Initiation of a new ASR to buy back up to $600 million of ADSs.
- Expected final settlement of the new ASR by Q4 2024.
Negative
- High expenditure on share repurchases, totaling up to $1 billion within a short period.
- Potential shareholder dilution if the company's financial performance does not improve.
Details
News Market Reaction – FMX
The recorded move for FMX in the trading session of this news was +0.78%.
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MONTERREY, Mexico, June 10, 2024 (GLOBE NEWSWIRE) -- Fomento Económico Mexicano, S.A.B. de C.V. (“FEMSA” or the “Company”) (NYSE: FMX; BMV: FEMSAUBD, FEMSAUB) announces today that it has entered into a new derivative instrument in the form of an accelerated share repurchase transaction (“ASR”) to repurchase the Company’s American Depositary Shares (“ADSs”)1. Under the terms of this new ASR, FEMSA has agreed to repurchase up to USD
Additionally, the Company announces the completion of the ASR announced in March 2024, which final delivery of the shares repurchased thereunder was on May 28, 2024. The Company repurchased a total of approximately 3.2 million ADSs at an average price of USD
About FEMSA
FEMSA is a company that creates economic and social value through companies and institutions and strives to be the best employer and neighbor to the communities in which it operates. It participates in the retail industry through a Proximity Americas Division operating OXXO, a small-format store chain, and other related retail formats, and Proximity Europe which includes Valora, our European retail unit which operates convenience and foodvenience formats. In the retail industry it also participates though a Health Division, which includes drugstores and related activities and Digital@FEMSA, which includes Spin by OXXO and Spin Premia, among other digital financial services initiatives. In the beverage industry, it participates through Coca-Cola FEMSA, the largest franchise bottler of Coca-Cola products in the world by volume. Across its business units, FEMSA has more than 392,000 employees in 18 countries. FEMSA is a member of the Dow Jones Sustainability MILA Pacific Alliance, the FTSE4Good Emerging Index and the Mexican Stock Exchange Sustainability Index: S&P/BMV Total México ESG, among other indexes that evaluate its sustainability performance.
1 ADS underlying units consist of ten FEMSA BD Units, each representing one Series B Share, two Series D-B Shares and two Series D-L Shares, without par value.
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