18 slides from Fomento Economico Mexicano Sab De Cv Units Cons. Of 5 Shsb's merger presentation, May 24, 2004
Slide 1: FEMSA and FEMSA Cerveza
FMX NYSE tx May 24, 2004
Slide 2: Cautionary Statements
Cautionary Statements Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1984 as amended. These forward-looking statements relate to Fomento Economico Mexicano, §.8, de CV. CFEMSA”) and its businesses
Slide 3: Contents: Transaction Overview
Contents | Transaction Overview
Slide 4: Transaction Overview
Transaction Overview 4 FEMSA has agreed to repurchase Interbrew’s 30% ownership interest in FEMSA Cerveza for US$ 1.245 billion in cash. 4 The transaction also involves unwinding FEMSA’s relationship with Labatt in the United States, as well as the following components: = The rights to FEMSA Cerveza
Slide 5: Transaction Overview (Cont'd)
Transaction Overview (Cont’ @ This transaction is the result of mutual agreement between FEMSA and Interbrew. 4 From the perspective of FEMSA’s shareholders, this transaction represents a significant increase in their participation in one of the world’s most attractive beer markets, under the right
Slide 6: Ownership Structure
Ownership Structure Current Interbrew Labatt USA Post Transaction 45 7% 100% ® FEMSA’s voting interest in Coca-Cola FEMSA is 53.6%.
Slide 7: Financing Structure
Il Financing Structure
Slide 8: Financing Snapshot
Financing Snapshot 4 FEMSA plans to finance the transaction as follows (US$ MM): FEMSA Cerveza Cash FEMSA Cash FEMSA Long Term Peso Notes (backed by FEMSA Cerveza) FEMSA Peso Term Loan FEMSA Bridge to Equity $250 in Pesos, $250 in US$ Total Consideration $200 aS 300 150 500 $1,245 24% Cash 36% Debt
Slide 9: FEMSA Debt Financing Summary
FEMSA Debt Financing Summary a The weighted average effective rate for new long term debt (all in Pesos) is expected to be approximately 7.5%. Type Amount Maturity commited Repayment Source (usgmm) Lender Bridge Loan to © Lyear BBVA Bancomer, Peso Certificados Peso Certificados Citigroup Bursatiles
Slide 10: Financing Structure
Financing Structure in The structure prudently utilizes FEMSA Cerveza's significant debt capacity, retaining financial flexibility, and maintaining an Investment Grade credit rating in local currency. — Net Debt / EBITDA ratios below 1.5x. Long Term Peso Notes (Certificados Bursatiles) provide attra
Slide 11: Conservative Credit Ratios
Conservative Credit Ratios 3/31/04 FEMSA ‘Actual Net Debt / LTM EBITDA®) March ‘04 1.65% Debt / Total Capitalization 44.0% LTMEBITDA® / Net Interest FIK 3/31/04 FEMSA Cerveza ‘Actual Net Debt / LTM EBITDA®) March ‘04 0.46% Debt / Total Capitalization 25.0% LTM EBITDA® / Net Interest 13.6% At Closing
Slide 12: Conservative Long Term Debt Mix
Conservative Long Term Debt Mix Rate FEMSA Fhied Rates Consolidated (After repayment of ask Bridge Loan to Equity) Floating Rates Fhied FEMSA iad Cerveza so Floating Rates Currency og Denominated 36% Peso Denominated uss Denominated 22% Peso Denominated Note: After giving effect to US§300MM Peso Not
Slide 13: FEMSA Equity Take-Out
FEMSA Equity Take-Out The US$500 million Bridge Facility is expected to be repaid with proceeds from a primary equity offering by FEMSA. - UB units and UBD units in proportion to existing capital structure. Our objective is to raise US$500 million; if market demand warrants increasing the size of th
Slide 14: FEMSA's liquidity has steadily increased
FEMSA’s liquidity has steadily increased| $50 28.0 $40 Price 25 23.0 jaa 20.1 $30 457102 16.1 M72 123 12.9 $20 8.1 P57 9.0 pug 9.5 108 ~~ Li Li - = $0 gBegsggsgsssesgses sea g e-a¢6 £65 ¢5 58482 St ogg 8 SPS 28 3 Gls G So 2 \ sees cps = I Daily Average Traded Volume (US$ MM) = Average ADR Price (US$
Slide 15: Contents: Conclusion
Contents Ill Conclusion 15
Slide 16: FEMSA's shareholders are acquiring a significant percentage of one of the world's most attractive beer markets
in FEMSA’s shareholders are acquiring a significant percentage of one of the world’s most attractive beer markets, at the right price. The financial strength of FEMSA and FEMSA Cerveza allow us to pursue this opportunity while maintaining a conservative Balance Sheet. FEMSA Cerveza is in the impleme
Slide 17: Slide 17
Slide 18: Signatures
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Date: May 24, 2004 Fomento Económico Mexicano S.A. de C.V. By: /s/ Federico Reyes Name: Federico Reyes