Mexico's Bimbo expands into Brazil with acquisition - Grupo Bimbo acquires Plus Vita - Brief Article - Statistical Data Included

Eurofood, March 29, 2001

Mexican food giant Grupo Bimbo has bought Brazilian bread firm Plus Vita from US agribusiness firm Bunge for US$63.5m (70.8m [European Dollar]), gaining a foothold in the only big Latin American country where it does not have a presence.

The move looks like a consolation prize, after Bimbo failed to buy Bestfoods' US baking operations from Unilever earlier this year. It was beaten by Canadian firm George Weston's US$1.7bn cash bid.

Bimbo has long been trying to expand outside its core Mexican market where it has a 90% share of the packaged bread sector, representing 74% of its total revenues. Bimbo's corporate director Pablo Elizondo explained to a press conference that the company considers the Brazilian market to have high growth potential since annual consumption of bread per capita is just 30 kg, of which only 6% is packaged bread.

PLUS VITA REVENUES OF US$72M

Plus Vita which manufactures products under the brand names Pullman, Plus vita, Ana Maria and Muffs, amassed sales revenues of US$72.4m last year, controlling 21% of the Brazilian packaged bread market, which is valued at around US$400m. Bimbo expects this to increase to 29%.

Bimbo, Latin America's largest bread maker is active in 15 countries, with sales of US$3.3bn last year, up 5% from 1999. If Bimbo still plans to be a major player in North America, US No. 1 Interstate Bakeries, which is currently fading following shocking financial results, could be a viable albeit ambitious option.