Published on 9 Nov 2022 on Zacks via Yahoo Finance
FEMSA (FMX) to Expand Digital Payments With NetPay Buyout
Fomento Económico Mexicano, S.A.B. de C.V. FMX, alias FEMSA, inked a deal to acquire all of the outstanding shares of NetPay. In 2019, FEMSA bought a minority equity stake in NetPay, which offers payment services and solutions to micro, small and medium-sized businesses in Mexico.The current deal is likely to close in the first quarter of fiscal 2023. The move will help expand FEMSA’s digital payments portfolio, which includes the Spin by OXXO wallet and OXXO Premia’s loyalty strategy.FEMSA continues to focus on offering customers more options to make contactless purchases by intensifying digital and technology-driven initiatives across operations. Within its OXXO store chains, the company is on track with investing in digital offerings, loyalty programs and fintech platforms to evolve stronger after the pandemic and over the long term.The company’s OXXO digital wallet, OXXO Premia and loyalty program have been performing well. In the second quarter of fiscal 2022, it made progress on its digital efforts, with customer acquisition surpassing 15 million users. The users are part of the company’s digital ecosystem either through Spin by OXXO, OXXO Premia or both.
What’s More?
FEMSA has been gaining from its effective growth strategies and robust demand across most markets. The company has been on track with its strategy of creating a national distribution platform in the United States through the expansion of its footprint in the specialized distribution industry. Its venture in the specialized distribution industry relates to its plan of investing in adjacent businesses, which can leverage capabilities across different markets, providing an opportunity for attractive growth and risk-adjusted returns.With the presence of its OXXO business and other retail operations, the company has become an expert in the organization and management of supply chains and distribution systems. Notably, FEMSA serves large numbers of businesses and retail customers through millions of interactions in different industries.We note that this Zacks Rank #3 (Hold) stock gained 23.1% in the past three months compared with the industry’s growth of 0.1%.