(Updates stock price, adds background on Vonpar)
MEXICO CITY, Sept 23 (Reuters) - Coca-Cola Femsa, Latin America's largest Coke bottler, on Friday said it would buy Brazilian beverage company Vonpar in a cash, stock and debt deal valued at 3.5 billion reais ($1.09 billion).
Shares of Coca-Cola Femsa rose sharply for the second day in a row, pushing the stock price to its highest in two months.
Coca-Cola Femsa said in a statement that its Brazilian unit Spal will pay 1.73 billion reais to Vonpar's owners as well as another 688 million reais that will be converted into Coca-Cola Femsa shares.
Spal will also issue 1.09 billion reais in convertible three-year debt to Vonpar owners.
Coca-Cola Femsa said that Vonpar's footprint was a "perfect geographic fit" for its operations in the south of Brazil and that it expects to see savings of around 65 million reais from the acquisition within two years.
Vonpar has three bottling facilities and five distribution centers with close to 4,000 employees serving more than 15 million consumers, Coca-Cola Femsa said.
On Friday, shares in Coca-Cola Femsa briefly jumped more than 3 percent to just below 153 pesos per share, its highest since late July. Shares then trimmed gains to 151.27 pesos, up 2 percent on the day. ($1 = 3.2114 Brazilian reais) (Reporting by Michael O'Boyle in Mexico City and Brad Haynes in Sao Paulo Editing by W Simon)