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Grupo Bimbo is set to begin operating 35 plants in the United States, employing 15,000 workers and covering 7,000 routes, and when it does, it will become the largest bread manufacturer in the world. This will happen once Bimbo finalizes the purchase of the bread manufacturing business of George Weston Foods, for which it will pay 2.38 billion dollars, according to statements by the Mexican company’s CEO Daniel Servitje.

With the Weston Foods merger, Bimbo –which already has a significant presence in the United States’ west coast– will close the 2008 fiscal year with sales estimated at 9.63 billion dollars, 50 percent of which will be from the Mexican market, 40 percent from the US market, and 10 percent from Latin America.

Now all Bimbo has to do is comply with a few legal and financial requirements and obtain the authorization of relevant antitrust bodies to become the top global bread manufacturer, pushing Kraft out of the leading position in the industry.

The transaction is made possible through 2.38 billion dollars in financing from Bank of America, BBVA, Banamex/Citi, HSBC, ING and Santander, which saw it as a wise move in a market that is not vulnerable to breakdowns like the automobile or mortgage industries. With these loans, Grupo Bimbo’s liabilities will jump from 800 million dollars to approximately 3 billion.

With information from La Jornada, Mexico 12.11.08