Spirits giant Diageo has reached an agreement to sell its majority stake in East African Breweries to Japanese brewer Asahi, company officials announced Wednesday.
Under the proposed transaction, Diageo would sell the entirety of Diageo Kenya Limited, which holds 65% of the shares of EABL. The deal also includes Diageo’s nearly 54% stake in UDVK, a Kenyan spirits business.
Company officials said that Asahi aims to “preserve beloved local brands” while introducing its own products into East Africa. East African Breweries, based in Nairobi and dating back more than a century, is the largest beer business in the region.
“This business is a high-quality, leading company in Kenya, Uganda and Tanzania with an unrivalled brand portfolio and marketing capabilities, state-of-the-art production facilities and strong market shares,” Asahi President and CEO Atsushi Katsuki said in a statement.
Diageo officials said the sale reflects its efforts to divest “non-strategic, non-core assets” and “strengthen our balance sheet.” The company committed to reaching new licensing deals with East Africa Breweries, under which the brewer would make products for Diageo’s Smirnoff, Captain Morgan, Guinness and other select brands.
“We are incredibly proud of the achievements of EABL and our colleagues across Kenya, Uganda and Tanzania,” said Nik Jhangiani, Diageo’s interim CEO.
