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Equity Accounted Investees | 12 Months Ended
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Dec. 31, 2018
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Equity Accounted Investees | Note 10. Equity accounted investees As of December 31, 2018 and 2017, Company’s equity accounted investees are as follows:
|  |  |  |  |  |  |  | Ownership Percentage |  |  | Carrying Value |
Investee |  | Principal Activity |  |  | Place of Incorporation |  |  | December 31, 2018 |  |  | December 31, 2017 |  |  | December 31, 2018 |  |  | December 31, 2017 |
Heineken (1)(2) |  |  | Beverages |  |  |  | The Netherlands |  |  |  | 14.8 | % |  |  | 14.8 | % |  | Ps. | 83,461 |  |  | Ps. | 83,720 |
Coca-Cola FEMSA: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Joint ventures: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Compañía Panameña de Bebidas, S.A.P.I. de C.V. |  |  | Beverages |  |  |  | Mexico |  |  |  | 50.0 | % |  |  | 50.0 | % |  |  | 1,550 |  |  |  | 2,036 |
Dispensadoras de Café, S.A.P.I. de C.V. |  |  | Services |  |  |  | Mexico |  |  |  | 50.0 | % |  |  | 50.0 | % |  |  | 162 |  |  |  | 153 |
Fountain Agua Mineral, L.T.D.A |  |  | Beverages |  |  |  | Brazil |  |  |  | 50.0 | % |  |  | 50.0 | % |  |  | 826 |  |  |  | 784 |
Associates: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Promotora Industrial Azucarera, S.A. de C.V. (“PIASA”) |  |  | Sugar production |  |  |  | Mexico |  |  |  | 36.4 | % |  |  | 36.4 | % |  |  | 3,120 |  |  |  | 2,933 |
Industria Envasadora de Querétaro, S.A. de C.V. (“IEQSA”) |  |  | Canned bottling |  |  |  | Mexico |  |  |  | 26.5 | % |  |  | 26.5 | % |  |  | 179 |  |  |  | 177 |
Industria Mexicana de Reciclaje, S.A. de C.V. (“IMER”) |  |  | Recycling |  |  |  | Mexico |  |  |  | 35.0 | % |  |  | 35.0 | % |  |  | 129 |  |  |  | 121 |
Jugos del Valle, S.A.P.I. de C.V. |  |  | Beverages |  |  |  | Mexico |  |  |  | 26.3 | % |  |  | 26.3 | % |  |  | 1,571 |  |  |  | 1,560 |
KSP Partiçipações, L.T.D.A. |  |  | Beverages |  |  |  | Brazil |  |  |  | 31.4 | % |  |  | 38.7 | % |  |  | 104 |  |  |  | 117 |
Leao Alimentos e Bebidas, L.T.D.A. |  |  | Beverages |  |  |  | Brazil |  |  |  | 24.7 | % |  |  | 24.7 | % |  |  | 2,084 |  |  |  | 3,001 |
UBI 3 Participações L.T.D.A. (“ADES”) |  |  | Beverages |  |  |  | Brazil |  |  |  | 26.0 | % |  |  | 26.0 | % |  |  | 7 |  |  |  | 391 |
Other investments in Coca-Cola FEMSA’s companies |  |  | Various |  |  |  | Various |  |  |  | Various |  |  |  | Various |  |  |  | 786 |  |  |  | 228 |
FEMSA Comercio: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Café del Pacífico, S.A.P.I. de C.V. (“CAFFENIO”) (4) |  |  | Coffee |  |  |  | Mexico |  |  |  | — |  |  |  | 40.0 | % |  |  | — |  |  |  | 539 |
Other investments (1) (3) |  |  | Various |  |  |  | Various |  |  |  | Various |  |  |  | Various |  |  |  | 336 |  |  |  | 337 |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Ps. | 94,315 |  |  | Ps. | 96,097 |
(1) | Associate.
(2) | As of December 31, 2018 comprised of 8.63% of Heineken, N.V. and 12.26% of Heineken Holding, N.V., which represents an economic interest of 14.76% in Heineken Group. The Company has significant influence, mainly, due to the fact that it participates in the Board of Directors of Heineken Holding, N.V. and the Supervisory Board of Heineken N.V.; and for the material transactions between the Company and Heineken Group.
(3) | Joint ventures.
(4) | Associate until May 22, 2018, date in which the Company acquired an additional 10% of participation in Caffenio reaching an amount of 50% of ownership and, through an agreement with other shareholders the Company assumed control of the subsidiary.
During 2018, Coca-Cola FEMSA received dividends from Industria Envasadora de Queretaro, S.A. de C.V. for the amount of Ps. 8. During 2017, the Coca-Cola FEMSA received dividends from Industria Envasadora de Queretaro, S.A. de C.V., and Promotora Mexicana de Embotelladores, S.A. de C.V. in the amount of Ps. 16 and Ps. 17, respectively. During 2018, the Company made capital contributions to Jugos del Valle, S.A.P.I. de C.V. and Promotora Industrial Azucarera, S.A. de C.V. in the amounts of Ps. 73 and Ps. 146, respectively, there were no changes in the ownership percentage as a result of capital contributions made by the other shareholders. During 2018, there was a spin-off for our investment in UBI 3 resulted in Ps. 333 capitalized. As of December 31, 2018, Coca-Cola FEMSA recognized an impairment, in their investment Compañía Panameña de Bebidas, S.A.P.I. de C.V., for an amount of Ps. 432 million charged as other expenses line. The Company will continue to monitor the results of this investment in conjunction with its partner The Coca-Cola Company, looking for alternatives to improve the business profitability in the near future. During 2017, Coca-Cola FEMSA made capital contributions to Compañía Panameña de Bebidas, S.A.P.I. de C.V. and Promotora Industrial Azucarera, S.A. de C.V. in the amounts of Ps. 349 and Ps. 182, respectively; and there were no changes in the ownership percentage as a result of capital contributions made by the other shareholders. On June 25, 2017, the Coca-Cola FEMSA through its Brazilian subsidiary Spal Industria Brasileria de Bebidas, S.A. sold 3.05% of their participation in Leao Alimentos e Bebidas, L.T.D.A. for an amount of Ps.198. On March 28, 2017, as part of AdeS acquisition the Coca-Cola FEMSA acquired indirect participations in equity method investees in Brazil and Argentina for an aggregate amount of Ps. 587. During 2017, Itabirito merged with Spal in a transaction did not generate any cash flow. On April 30, 2010, the Company acquired an economic interest of 20% of Heineken Group. Heineken’s main activities are the production, distribution and marketing of beer worldwide. On September 18, 2017, the Company concluded the sale of a portion of its investment, representing 5.2% combined economic interest, consisting of 22,485,000 Heineken N.V. shares and 7,700,000 Heineken Holding N.V. shares at the price of €. 84.50 and €. 78.00 per share, respectively, see Note 4.2. The Company recognized an equity income of Ps. 6,478, Ps. 7,847 and Ps. 6,342 net of taxes based on its economic interest in Heineken Group for the years ended December 31, 2018, 2017 and 2016, respectively. The economic interest for the year 2018 was 14.8%, for the year 2017 was 20% for the first eight months and 14.8% for the last four months and for the year 2016 was 20%. The Company’s share of the net income attributable to equity holders of Heineken Group exclusive of amortization of adjustments amounted to Ps. 6,320 (€. 281 million), Ps. 7,656 (€. 357 million) and Ps. 6,430 (€. 308 million), for the years ended December 31, 2018, 2017 and 2016, respectively. Summarized financial information in respect of the associate Heineken Group accounted for under the equity method is set out below.
|  | December 31, 2018 |  |  | December 31, 2017 |
Amounts in millions |  | Peso |  |  | Euro |  |  | Peso |  |  | Euro |
Total current assets |  | Ps. | 204,422 |  |  | €. | 9,070 |  |  | Ps. | 194,429 |  |  | €. | 8,248 |
Total non-current assets |  |  | 741,195 |  |  |  | 32,886 |  |  |  | 772,861 |  |  |  | 32,786 |
Total current liabilities |  |  | 235,525 |  |  |  | 10,450 |  |  |  | 246,525 |  |  |  | 10,458 |
Total non-current liabilities |  |  | 359,846 |  |  |  | 15,966 |  |  |  | 378,463 |  |  |  | 16,055 |
Total equity |  |  | 350,245 |  |  |  | 15,540 |  |  |  | 342,302 |  |  |  | 14,521 |
Equity attributable to equity holders |  |  | 323,605 |  |  |  | 14,358 |  |  |  | 314,017 |  |  |  | 13,321 |
Total revenue and other income |  | Ps. | 517,115 |  |  | €. | 22,546 |  |  | Ps. | 493,488 |  |  | €. | 21,750 |
Total cost and expenses |  |  | 445,165 |  |  |  | 19,409 |  |  |  | 417,434 |  |  |  | 18,398 |
Net income |  | Ps. | 48,051 |  |  | €. | 2,095 |  |  | Ps. | 48,850 |  |  | €. | 2,153 |
Net income attributable to equity holders |  |  | 43,647 |  |  |  | 1,903 |  |  |  | 43,903 |  |  |  | 1,935 |
Other comprehensive income |  |  | (1,170 | ) |  |  | (51 | ) |  |  | (26,524 | ) |  |  | (1,169 | )
Total comprehensive income |  | Ps. | 46,881 |  |  | €. | 2,044 |  |  | Ps. | 22,326 |  |  | €. | 984 |
Total comprehensive income attributable to equity holders |  |  | 42,386 |  |  |  | 1,848 |  |  |  | 19,989 |  |  |  | 881 |
Reconciliation from the equity of the associate Heineken Group to the investment of the Company.
|  | December 31, 2018 |  |  | December 31, 2017 |
Amounts in millions |  | Peso |  |  | Euro |  |  | Peso |  |  | Euro |
Equity attributable to equity holders of Heineken |  | Ps. | 323,608 |  |  | €. | 14,358 |  |  | Ps. | 314,018 |  |  | €. | 13,321 |
Economic ownership percentage |  |  | 14.76 | % |  |  | 14.76 | % |  |  | 14.76 | % |  |  | 14.76 | %
Investment in Heineken investment exclusive of goodwill and other adjustments |  | Ps. | 47,765 |  |  | €. | 2,119 |  |  | Ps. | 46,349 |  |  | €. | 1,966 |
Effects of fair value determined by purchase price allocation |  |  | 15,846 |  |  |  | 703 |  |  |  | 16,610 |  |  |  | 705 |
Goodwill |  |  | 19,850 |  |  |  | 881 |  |  |  | 20,761 |  |  |  | 881 |
Heineken investment |  | Ps. | 83,461 |  |  | €. | 3,703 |  |  | Ps. | 83,720 |  |  | €. | 3,552 |
As of December 31, 2018 and 2017, the fair value of Company’s investment in Heineken N.V. Holding and Heineken N.V. represented by shares equivalent to 14.8% of its outstanding shares amounted to Ps. 145,177 (€. 6,441 million) and Ps. 170,517 (€. 7,234 million) based on quoted market prices of those dates. As of April 19, 2019, issuance date of these consolidated financial statements, fair value amounted to €. 7,930 million. During the years ended December 31, 2018, 2017 and 2016, the Company received dividends distributions from Heineken Group, amounting to Ps. 2,388, Ps. 3,250 and Ps. 3,263, respectively. For the years ended December 31, 2018, 2017 and 2016 the total net income corresponding to the immaterial associates of Coca-Cola FEMSA was Ps. 44, Ps. 235 and Ps. 31, respectively. For the years ended December 31, 2018, 2017 and 2016 the total net income or loss corresponding to the immaterial joint ventures of Coca-Cola FEMSA was a loss of Ps. 270, a loss of Ps. 175, and a gain of Ps. 116, respectively. For the year ended December 31, 2018, 2017 and 2016, the Company’s share of other comprehensive income from equity investees, net of taxes are as follows:
|  | 2018 |  |  | 2017 |  |  | 2016 |
Items that may be reclassified to consolidated net income: |  |  |  |  |  |  |  |  |  |  |  |
Valuation of the effective portion of derivative financial instruments |  | Ps. | (355 | ) |  | Ps. | 252 |  |  | Ps. | 614 |
Exchange differences on translating foreign operations |  |  | (6 | ) |  |  | (2,265 | ) |  |  | (2,842 | )
Total |  | Ps. | (361 | ) |  | Ps. | (2,013 | ) |  | Ps. | (2,228 | )
Items that may not be reclassified to consolidated net income in subsequent periods: |  |  |  |  |  |  |  |  |  |  |  |
Remeasurements of the net defined benefit liability |  | Ps. | 597 |  |  | Ps. | 69 |  |  | Ps. | (1,004 | )

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