Diageo has agreed to sell its controlling stake in East African Breweries Plc to Japan’s Asahi Group Holdings in a landmark transaction that values the region’s largest brewer at an implied enterprise value of US$ 4.8Bn, equivalent to about KSh 618.7Bn at the prevailing exchange rate.
- •The UK-listed spirits group said it will sell its entire shareholding in Diageo Kenya Limited, which owns 65.0% of EABL, alongside its direct stake in UDV Kenya, the local spirits producer and importer.
- •The buyer is Asahi Group Holdings Ltd, a Japanese listed global beverage company with operations across beer, spirits, soft drinks, and food.
- •Diageo expects net proceeds of approximately US$ 2.3Bn, or about KSh 296.5Bn, a multiple of 17x adjusted EBITDA.
EABL operates brewing and spirits businesses across the three countries and traces its history back more than a century. It remains the dominant beer producer in East Africa, supported by modern production facilities and a well-established distribution network.
Asahi described the acquisition as a strategic entry into Africa’s alcoholic beverages market, marking the first time a major Japanese brewing group has made an investment of this scale on the continent. Diageo said the disposal will reduce group leverage by around 0.25x, supporting its stated target leverage range of 2.5x to 3.0x.
Despite the sale, Diageo will retain a commercial presence in East Africa through long-term licensing and transitional service agreements with EABL. These arrangements will secure the continued production and distribution of Guinness, selected Diageo spirits, and ready-to-drink brands, as well as the import and distribution of Diageo’s international premium spirits portfolio. Locally owned brands such as Tusker and Kenya Cane will remain under EABL ownership.
EABL owns 46.32% of UDV Kenya, with Diageo holding the remaining 53.68% stake being sold as part of the transaction.
Diageo has recently announced a strategic review of its stake in United Spirits Limited in India, as well as its association with the Royal Challengers Bengaluru cricket franchise.
