The Mexican brewer Femsa has indicated that it may sell its beers in Brazil as a way of fighting off competition in Latin America from the soon to be formed beer giant InterbrewAmbev. Femsa is expecting InterbrewAmBev to sell its Skol brand in Mexico, but speaking to Reuters in an interview, the company’s chief financial officer Federico Reyes said: "We will react."

He added that one possibility was to sell its own beer in Ambev’s domestic market of Brazil, using the company’s soft drink affiliate Coca-Cola Femsa, which has operations in the country already.

"Coke bottlers already distribute beer in Brazil and this will not be an alien concept to KOF," said Reyes.

Interbrew and Femsa announced an agreement earlier this week to end their long-term partnership after Femsa objected to Interbrew’s proposed merger with Ambev.

Femsa dropped its objection to the merger in return for regaining control of its US exports and Interbrew selling back a 30% stake it had in Femsa's beer unit.

31 May, 2004