Femsa agrees to terminate joint venture with Raizen in Brazil

Fomento Economico Mexicano entered into definitive agreements with Raizen to amicably terminate their joint venture in Brazil known as “Grupo Nos” that includes OXXO proximity stores and Shell Select convenience stores, allowing both companies to focus on their respective business’ strategies. Under the terms of the agreement, FEMSA (FMX) will retain all the OXXO stores in Brazil, as well as the distribution center located in Cajamar, Sao Paulo, while Raizen will retain all the Shell Select convenience stores. All other assets and liabilities will be allocated between Raizen and FEMSA as agreed in the definitive agreements. The transaction will be cash-neutral for both parties, with FEMSA assuming the existing and outstanding debt of Grupo Nos as of closing. OXXO Brazil is a top strategic priority within FEMSA’s retail business strategy. The country’s large market size, highly fragmented retail landscape, and strong product-market fit with the OXXO value proposition present a significant growth opportunity. FEMSA aims to build a scalable, profitable business by focusing on accelerated store expansion, adapting the OXXO format to local consumer needs, and driving long-term return on invested capital through sustained top-line growth and operational efficiency. Completion of the separation of the OXXO stores and the Shell Select convenience stores is subject to regulatory approvals and other customary conditions and is expected to close in the coming months.