Diageo, the world’s largest spirits group, has agreed to sell its 65% stake in East African Breweries (EABL) to Japan’s Asahi Holdings for $2.3 billion, thus divesting its last direct stake in African beer.
The deal values EABL, a Nairobi blue-chip company and one of East Africa’s top five companies by market capitalization, at around $4.8 billion, Diageo and Asahi said Wednesday.
It also marks the largest investment in an African alcoholic beverage company by a Japanese brewer, they added in a joint statement.
EABL, which also operates in Tanzania and Uganda, is known for its Tusker brand of beer, named after the elephant that gored one of the brewery’s founders during a hunting expedition in 1923.
The deal says EABL will retain Tusker and other local brands, and sign new deals with Diageo to produce Guinness and some spirits, as well as import and distribute others.
More context: Diageo considers selling its Guinness beer brand: Bloomberg News
Diageo and EABL deal to close in 2026
Diageo, a London-listed company and maker of Johnnie Walker whiskey and Captain Morgan rum, faces tariff increases in the US, its key market; high levels of debt and signs that some younger consumers may be giving up alcohol.
It pledged to sell non-core assets as part of a plan to reduce debt and costs. It stated that the sale of EABL was consistent with its strategy.
“This transaction brings significant value to Diageo shareholders and reinforces our commitment to strengthening the balance sheet,” said Nick Jhangiani, Interim CEO of Diageo.
Diageo shares were up 1.9% at 08:58 GMT, while EABL shares were up almost 4%.
Jhangiani will resume the role of CFO in January, when Dave Lewis takes over. The former Tesco boss has been named Diageo’s new chief executive, aiming to revive growth.
Japanese company Asahi has been looking for opportunities in markets such as Africa and South America in its quest for global expansion. Its president and CEO, Atsushi Katsuki, said EABL offers an unrivaled portfolio of brands, marketing capabilities and production facilities.
The agreement will be closed in the second half of 2026.
With information from Reuters
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