Diageo divests stake in East African Breweries to Japan’s Asahi for US$2.3B
The transaction marks Diageo’s exit from EABL, transferring control to Japan’s Asahi Group, subject to regulatory approval.
KENYA – British multinational Diageo Plc has agreed to sell its entire 65 percent shareholding in East African Breweries Limited (EABL) and its majority stake in spirits producer UDV Kenya to Japan’s Asahi Group Holdings in a transaction valued at US$2.3 billion.
Under the agreement, Asahi will acquire full control of Diageo Kenya Limited, the holding company through which Diageo owns its stake in EABL.
The Japanese beverage group will also take over Diageo’s 53.68 percent interest in UDV Kenya. EABL currently owns the remaining stake in UDV Kenya and retains management control of the spirits unit.
The transaction, which is subject to regulatory approvals, is expected to be completed in the second half of 2026. Based on the deal terms, EABL is valued at approximately Kes 618.9 billion (US$4.8 billion).
Diageo’s exit comes less than three years after it increased its ownership in EABL to 65 percent from 50.03 percent, following a Kes 22.7 billion (US$175M) transaction. The sale aligns with Diageo’s strategy to streamline its portfolio and reduce leverage through the disposal of non-core assets.
“This transaction delivers significant value for Diageo shareholders and accelerates our commitment to strengthen our balance sheet,” said Diageo interim chief executive officer Nik Jhangiani.
He added that the company remains focused on returning leverage to within its target range of 2.5 to 3.0 times through asset disposals. Diageo will continue to partner with Asahi through long-term licensing arrangements.
As part of the agreement, Diageo has entered into licensing deals with EABL to ensure the continued production and distribution of Guinness, selected local spirits and ready-to-drink brands, as well as the distribution of Diageo’s international spirits portfolio in the region.
EABL said the transaction would not result in operational changes across the group and confirmed that no jobs would be affected.
Chief executive officer Jane Karuku described the acquisition as a milestone for the brewer, noting that Asahi’s global expertise in brand development and innovation would support EABL’s growth ambitions across Africa.
Asahi enters African market
Asahi Group Holdings, listed on the Tokyo Stock Exchange, operates a broad portfolio of alcoholic and non-alcoholic beverages and food products.
The company has operations across Japan and East Asia, Europe, and the Asia-Pacific region, and reported annual revenue of approximately US$19 billion. The acquisition marks Asahi’s entrance into the African alcoholic beverages market.
Asahi president and chief executive officer Atsushi Katsuki said EABL offers a strong portfolio of brands, production capabilities and marketing strength across East Africa.
He said the group aims to drive sustainable growth and enhance long-term corporate value following the acquisition.
For the financial year ended June 30, 2025, EABL reported net sales of US$996 million, earnings before interest, tax, depreciation and amortization of US$258 million, and net profit of US$94 million.
Light Asset Strategy
The transaction forms part of Diageo’s broader strategy of shedding non-core assets, which has seen it exit major African beer markets. In July, Diageo completed the sale of its 80.4% shareholding in Guinness Ghana Breweries plc to Castel Group for US$81 million.
In April, it sold its Seychelles Breweries Ltd, an 80.4 percent stake in Ghana Breweries and last year ceeded Guinness Nigeria to Singapore-based Tolaram. This followed exits in Ethiopia and Cameroon in 2022.
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