Diageo, the world’s largest spirits maker, has agreed to sell its 65% controlling stake in East African Breweries Limited to Japan’s Asahi Group Holdings for an estimated Sh297 billion ($2.3 billion) in net proceeds, the companies announced Wednesday.
The deal, equivalent to about Sh297 billion at current exchange rates, also includes Diageo’s majority holding in Kenya-based spirits producer UDVK and marks the British company’s exit from direct ownership of beer operations in Africa.
It values EABL — a leading Nairobi-listed company and East Africa’s biggest brewer — at an enterprise value of $4.8 billion.
Diageo, producer of Johnnie Walker whisky and Guinness stout, has been shedding non-core assets to reduce high debt levels amid challenges including U.S. tariff increases and shifting consumer habits among younger drinkers.
“This transaction delivers both significant value for Diageo shareholders and accelerates our commitment to strengthen the balance sheet,” said Nik Jhangiani, Diageo’s interim chief executive.
The sale is expected to lower Diageo’s debt ratio by about 0.25 times. Shares in London-listed Diageo rose nearly 2% in morning trading, while EABL shares on the Nairobi exchange gained almost 4%.
Iconic brands to continue under new ownership
EABL, operating in Kenya, Uganda and Tanzania, is best known for Tusker lager — named after an elephant that killed one of the founders during a 1923 hunting trip — along with other local favorites like Senator and Serengeti.
Under the agreement, EABL will keep ownership of its local brands and enter long-term licensing deals with Diageo to continue producing Guinness, certain spirits like Smirnoff and Captain Morgan, and ready-to-drink products. Diageo brands will also be imported and distributed in the region.
The arrangement ensures continuity for consumers, with no immediate changes to popular drinks.
In its latest fiscal year ending June 2025, EABL reported net sales of nearly $1 billion and adjusted EBITDA of $258 million.
Asahi’s major push into Africa
For Asahi, known for Asahi Super Dry beer and international brands like Peroni, the acquisition is its largest investment in an African alcohol business.
The Japanese company has been expanding globally, targeting growth markets in Africa and Latin America.
Asahi President and CEO Atsushi Katsuki called EABL’s portfolio “unrivalled,” citing its strong brands, marketing and production facilities.
“We will pursue sustainable growth … while contributing to the development of the local economies,” Katsuki said.
Asahi plans to maintain EABL’s listings on stock exchanges in Kenya, Uganda and Tanzania and has no plans for a mandatory buyout of minority shareholders.
The transaction requires regulatory approvals in the three countries and is slated to close in the second half of 2026.
Jhangiani will step down as interim CEO in January, handing over to incoming chief executive Dave Lewis, the former Tesco boss hired to revive growth.
The deal caps Diageo’s retreat from African brewing after earlier sales in Nigeria, Ghana and other markets, while retaining licensing ties for key brands like Guinness.
