British drinks giant Diageo said Wednesday it plans to sell its 65-percent stake in Kenya-based East African Breweries (EABL) to Japan’s Asahi Holdings in a deal valued at about US$2.3 billion.
The sale marks a major shift for Diageo, the world’s largest spirits producer and maker of Johnnie Walker whisky and Guinness beer, as it looks to streamline its portfolio amid mounting pressures in key markets.
The London-listed group has been grappling with higher tariffs in the United States, its biggest market, rising debt levels and changing consumer habits, particularly among younger drinkers who are increasingly cutting back on alcohol.
Diageo said the disposal was in line with its strategy to offload non-core assets and focus on faster-growing premium spirits brands, adding that the transaction would strengthen its balance sheet.
East African Breweries, one of the region’s largest drinks producers, has operations across Kenya, Uganda and Tanzania and is best known for brands including Tusker lager and locally produced spirits.
Asahi, Japan’s largest brewer, has been expanding its international footprint in recent years as domestic beer consumption declines, snapping up overseas assets to drive growth.
The deal is subject to regulatory approvals and is expected to close later this year, Diageo said.
Overview of Diageo’s operations in East Africa
For decades, Diageo has anchored its presence in East Africa through East African Breweries Limited (EABL), a company that has grown into one of the region’s most influential alcoholic beverage producers. With a 65 percent stake, Diageo has relied on EABL as its gateway to the Kenyan, Ugandan, and Tanzanian markets, using the local powerhouse to produce some of its global brands closer to home.
EABL is perhaps best known for its iconic beers such as Tusker Lager, Kenya’s flagship brew, and locally bottled Guinness, alongside spirits like Smirnoff Vodka and Johnnie Walker whisky. Over the years, the company has expanded its portfolio to include non-alcoholic drinks like Malta and soft drinks, reflecting its broad regional ambitions.
The company’s operations span multiple countries: in Kenya, breweries in Nairobi, Ruaraka, and Kisumu supply a vast network of bars and retail outlets; in Uganda, its Kampala and Soroti facilities cater to local tastes; and in Tanzania, breweries in Dar es Salaam and beyond focus on both mainstream and premium beers. Through this network, EABL has secured a dominant share of the Kenyan beer market estimated at around 60 percent and a significant presence across the region.
Beyond market share, EABL has played a critical role in the local economy. It is a major employer and taxpayer, supporting local barley farmers, small-scale distributors, and thousands of retail outlets. Its strategic investments have modernised production, strengthened distribution, and promoted sustainability initiatives such as water conservation.
For Diageo, EABL has been more than just a revenue generator it has served as a regional hub, allowing the global spirits giant to navigate tariffs, reduce import costs, and cultivate brand loyalty among East African consumers. The company’s deep-rooted presence, combined with its iconic brands, made EABL a jewel in Diageo’s portfolio for decades.
