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Cofece approves merger between Diageo and Mezcal Union

The Federal Commission of Economic Competition (Cofece) of Mexico approved the concentration between Diageo, a British company dedicated to the manufacture and distribution of alcoholic beverages, and Mezcal Union.

To start this transaction, on September 15, 2021, Diageo México Comercializadora (Diageo); Diageo Mexico Operations, and Mezcal Unión Holding notified Cofece of their intention to hold a merger.

Later, on October 26, Liga Productora and Agencia Unión adhered to the merger notification procedure.

The notified operation consists of the acquisition, directly or indirectly, by Diageo, of a certain number of shares representing the capital stock of Casa UM.

From the analysis carried out by the Commission, it is considered that, if the notified operation were carried out, and in accordance with the non-competition clause presented by the Notifiers, it would have little probability of affecting the process of free competition and economic competition.

Diageo owns more than 200 brands sold in more than 180 countries.

Combined with the breadth and depth of its portfolio across attractive categories and price points, the company has exposure to some of the biggest consumer growth opportunities and some resilience to global trade volatility.

Diageo also takes an active and disciplined approach to managing its portfolio of brands.

Through the acquisition of premium-plus brands in fast-growing categories, such as the Don Julio tequila brands in 2015 and Casamigos in 2017, as well as strategic divestitures, including the sale of its core U.S. wine business in 2016 and 19 brands in the United States in 2018, the company has strengthened its portfolio and geographic presence.

Diageo

The Commission is responsible for preventing concentrations whose purpose or effect is to reduce, damage or impede competition and free market access.

In addition, the Cofece is empowered to challenge and sanction those concentrations and legal acts derived from them, whose purpose or effect is to diminish, damage or prevent competition and free concurrence, in the production, distribution and commercialization of goods and services in the Republic. Mexican.

Therefore, the Commission may authorize concentrations that are not contrary to the process of competition and free concurrence under the terms of the Federal Economic Competition Law.

 

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