Diageo has agreed to sell its entire shareholding in Diageo Kenya Limited to Asahi Group Holdings, a move that will transfer control of East African Breweries Limited (EABL), the leading beer and spirits producer in East Africa.

Diageo Kenya Limited currently holds a 65% stake in EABL, which operates across Kenya, Uganda, and Tanzania. The transaction also includes Diageo’s interests in the Kenyan spirits business United Distillers Vintners Kenya (UDVK).

Under the terms of the agreement, Asahi will acquire Diageo’s 53.68% direct ownership in UDVK, while EABL retains the remaining 46.32% stake. EABL will continue to hold management control of the spirits business and fully consolidate its operations.

EABL, which has been in operation for more than a century, is the largest brewing company in East Africa. The company is known for its strong local brands, extensive distribution network, and modern production facilities across the region.

Asahi Group Holdings, a Japan-listed global beverage company, has a diversified portfolio covering beer, spirits, non-alcoholic beverages, and food. The acquisition represents Asahi’s first major investment of this scale in Africa’s alcoholic beverage sector.

As part of the transaction, Diageo will enter into long-term licensing and transitional services agreements with EABL. These arrangements will allow EABL to continue producing and distributing selected Diageo brands under licence, including Guinness, certain Smirnoff and Captain Morgan products, as well as ready-to-drink brands such as Smirnoff Ice and Orijin.

Well-known locally owned brands, including Tusker and Kenya Cane, will remain with EABL. Asahi has indicated that it plans to preserve these established local brands while selectively introducing globally recognised products from its portfolio to consumers in East Africa.

Commenting on the transaction, Diageo Interim Chief Executive Officer Nik Jhangiani said the group was proud of what had been built in the region. “We are incredibly proud of the achievements of EABL and our colleagues across Kenya, Uganda, and Tanzania. Together, EABL and Diageo have built the largest beer business in East Africa, driven by passionate people serving consumers and communities,” Jhangiani said.

He added that Diageo will continue its relationship with EABL through brand licensing while strengthening its financial position. “This transaction delivers significant value for Diageo shareholders and accelerates our commitment to strengthening our balance sheet. We remain focused on returning the Group to well within our target leverage ratio of 2.5–3.0x through disposals of non-strategic assets, alongside disciplined capital allocation.”

Asahi Group Holdings President and Chief Executive Officer Atsushi Katsuki described EABL as a high-quality, market-leading business with strong long-term potential. “This is a market-leading business in Kenya, Uganda, and Tanzania, with an unrivalled brand portfolio, strong marketing capabilities, and state-of-the-art production facilities,” Katsuki said.
“Together with its management team and employees, we will pursue sustainable growth and long-term enhancement of corporate value while contributing to the development of local economies.”

Diageo expects net proceeds of approximately $2.3 billion, after tax and transaction costs. The transaction implies an enterprise value of about $4.8 billion for 100% of EABL, representing a multiple of around 17 times adjusted EBITDA.

The deal remains subject to regulatory approvals, with completion expected in the second half of calendar year 2026. The disposal is consistent with Diageo’s strategy to streamline its portfolio, reduce debt, and reinforce its balance sheet, while positioning EABL for its next phase of growth under new ownership.