Diageo reportedly set to review US$2B stake in East African Breweries
Diageo is evaluating its controlling interest in EABL as part of a broader move to streamline global operations.
KENYA – Diageo Plc, the British multinational alcoholic beverage firm, has initiated a strategic review of its majority ownership in East African Breweries Ltd. (EABL), according to a report by Bloomberg.
The company, known globally for its Johnnie Walker brand, holds a 65% stake in the Nairobi-listed EABL.
The review process will be guided by financial advisers Bank of America and Goldman Sachs. It could result in either a complete or partial divestment of EABL’s beer business.
Analysts estimate the transaction could generate as much as US$2 billion (approximately Kes 258 billion), exceeding the brewer’s current market valuation of US$1.2 billion (roughly Kes 155 billion) on the Nairobi Securities Exchange.
Founded in 1922 as Kenya Breweries Ltd., EABL remains a leading player in East Africa’s alcoholic beverage industry.
Operating in Kenya, Uganda, and Tanzania, it also distributes to more than 10 African countries. Its brand portfolio includes Tusker, Bell Lager, Kenya Cane, and licensed Guinness products.
The possible divestment aligns with Diageo’s global strategy to adopt an asset-light model aimed at releasing capital and enhancing growth.
In recent years, the company has withdrawn from several African markets, including Ghana, Nigeria, Cameroon, Seychelles, and Ethiopia. A sale of EABL would mark its largest retreat from the continent’s beer market to date.
Potential suitors for the EABL business include Heineken NV, AB InBev, and France’s Castel Group. However, no definitive decisions have been made.
The development comes after Diageo announced earlier this month that CEO Debra Crew would be stepping down in July.
CFO Nik Jhangiani has assumed the role on an interim basis. In June, the company also unveiled plans to cut US$500 million in costs over three years to bolster resilience and efficiency.
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