Beer and soda bottler Fomento Economico Mexicano, also known as FEMSA (FMX +0.10%), announced Thursday that its board of directors had agreed to separate the roles of its chairman and the company CEO.
OXXO chain store. Source: FEMSA Investor Presentation, July 2013
The company, which is the world's largest franchise bottler of Coca-Cola (KO +0.48%) products and the second largest equity owner of Heineken, says it has grown to such a large scale geographically and in complexity that the two positions are best handled by two separate individuals. The split will allow each person to focus more acutely on the responsibilities of each role.
The board's executive chairman will maintain proper attention on the various levels of corporate governance while managing strategic relationships with key partners, authorities, and shareholders. The CEO, on the other hand, can concentrate on the day-to-day stewardship of FEMSA's businesses, leading and managing the senior team, and interacting with the board to carry out the short- and long-term plans and strategies of the company.
The proposal was made by current Chairman and CEO Jose Antonio Fernandez Carbajal, who has since been ratified as the board's executive chairman. The new CEO will be Carlos Salazar Lomelin, who until his appointment was CEO of Coca-Cola FEMSA (KOF +0.43%), the producer and distributor of Coca-Cola products throughout Latin America. He served in that capacity for the past 14 years.
Commenting on the separation of roles and the growth of FEMSA, Carbajal noted the board agreed to the change because it "will allow us to drive the growth and development of FEMSA with an even higher level of focus."
Lomelin concurred, saying: "I welcome this new responsibility, convinced that these changes, just like the adjustments we constantly make throughout FEMSA, will be beneficial for our company and for everyone who is a part of it. And they will help us to better achieve our mission to create economic and social value for all our key stakeholders."
Moving into the position of CEO of Coca-Cola FEMSA is the company's COO of the South America Division, John Santa Maria Otazua, a position he has held since 2000. He has been with the bottler for 18 years.
Calling Otazua a "visionary" during his tenure with the company, Lomelin said, "In his new role, the company will remain committed to the creation of long-term value within the beverage industry and will continue to contribute to the growth and development of the Coca-Cola system."
All of the management changes will become effective on Jan. 1.
In addition to its bottling activities, FEMSA also operates small-format chain stores, including OXXO, the largest and fastest-growing chain of stores in Latin America.
