Fomento Económico Mexicano SAV de CV, or FEMSA, announced March 9 that it agreed to invest $900 million in Waxie Sanitary Supply and North American Corp. for a majority stake in the merged company.
San Diego-based Waxie and Chicago-based North American operate 26 distribution centers across the U.S. and have combined annual revenue of more than $900 million.
Under the definitive agreements entered into by Mexico's FEMSA with the two companies, the group will form a new platform within the country's janitorial and sanitary supply, packaging, and specialized distribution industry.
Waxie CEO Charles Wax and North American CEO John Miller will be co-CEOs of the new business. The companies will also maintain their current management teams, and shareholders of Waxie and North American will remain investors.
"This transaction is consistent with FEMSA’s capability set and fits well with our strategic intent of investing in adjacent businesses that can leverage those capabilities across different markets, while providing an opportunity for attractive growth and risk-adjusted returns," said the bottler of The Coca-Cola Co. trademark beverages.
The deal is expected to close during the first semester of 2020, subject to customary regulatory approvals.