March 23, 2018 / 9:44 PM / a month ago

Crime forces Coke Femsa to end operations in Mexican town

MEXICO CITY (Reuters) - Mexico’s Coca-Cola Femsa, the world’s largest Coke bottler, said on Friday it had decided to indefinitely shut down operations in a town in southwestern Mexico after being crippled by violence and organized crime.

A Coca-Cola truck is seen in traffic in Mexico City September 9, 2013. REUTERS/Edgard Garrido

The firm, a joint venture between Fomento Economico Mexicano (Femsa) and Coca-Cola Co, said it was shuttering operations at its 160-employee distribution center in Ciudad Altamirano in Guerrero state.

“The lack of conditions necessary to operate in an efficient and safe way in this area of the state of Guerrero, as well as the recent unwarranted aggression towards one of our workers, led to the company taking this decision,” Coca-Cola Femsa said in a statement.

The company said it “profoundly regrets that the absence of law and the prevalence of impunity that affects the region has led us to stop working in a territory where we have been for more than four decades.”

Guerrero, which is home to the Pacific resort of Acapulco, is one of the poorest and most violent states in Mexico, assailed by opium-growing drug cartels and endemic corruption.

The news is a blow to the government of President Enrique Pena Nieto, which has failed to curb gang violence while trying to lure foreign investment into Latin America’s No. 2 economy. Murders in Mexico hit a record high last year.

Shares in Coca-Cola Femsa were down 2.25 percent on Friday afternoon.

Reporting by Gabriel Stargardter; editing by Grant McCool

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