The ratings on Coca-Cola Femsa S.A. de C.V. (KOF) reflect the company's strong business fundamentals, as well as the company's positive deleveraging three years after acquiring Panamerican Beverages Inc. In addition, the ratings reflect Standard&Poor's Ratings Services' expectations that the company will continue to improve its financial profile through robust cash-flow generation in its core markets and an adequately designed debt repayment program. In our opinion, KO's implicit support will continue to strengthen not only from an ownership perspective (KO holds a 39.6% stake in KOF), but more importantly due to the strategic position that KOF holds in the Coke system in Latin America. These factors are partially offset by high competition that has recently increased from companies
