Nairobi/London, December 17, 2025 – Diageo PLC, the world’s largest spirits producer, has agreed to sell its 65% stake in East African Breweries Limited (EABL) to Japan’s Asahi Holdings for $2.3 billion, marking the company’s exit from its last direct African beer investment. The transaction values EABL, a Nairobi blue-chip stock and one of East Africa’s largest companies by market capitalization, at around $4.8 billion, the companies announced on Wednesday.

This deal represents the largest investment by a Japanese brewer in an African alcohol business, underscoring Asahi’s strategy to expand globally, including into emerging markets such as Africa and South America.

EABL and Its Iconic Brands

EABL, which also operates in Tanzania and Uganda, is best known for its Tusker beer brand, named after the elephant that fatally gored one of the brewery’s founders in 1923. Under the deal, EABL will continue to retain Tusker and other local brands. New agreements with Diageo will allow the company to produce Guinness and certain spirits locally, while importing and distributing other Diageo products in the region.

Strategic Rationale for Diageo

London-listed Diageo, maker of iconic brands including Johnnie Walker whisky and Captain Morgan rum, has faced challenges in its key U.S. market, including tariff hikes, elevated debt levels, and shifts in drinking patterns among younger consumers.

The sale of EABL aligns with Diageo’s strategy to divest non-core assets, reduce debt, and cut costs. Nick Jhangiani, Diageo’s interim CEO, said:

“This transaction delivers both significant value for Diageo shareholders and accelerates our commitment to strengthen the balance sheet.”

Following the announcement, Diageo shares rose 1.9%, while EABL shares increased nearly 4%, reflecting investor confidence in the deal.

Asahi’s Global Expansion

Asahi has been actively seeking acquisitions to strengthen its presence in global markets. Atsushi Katsuki, Asahi’s president and CEO, described EABL as offering “an unrivalled portfolio of brands, marketing capabilities and production facilities,” positioning the company for growth in East Africa.

The transaction is expected to close in the second half of 2026, subject to regulatory approvals and customary closing conditions.

Broader Market Context

This deal highlights growing foreign investment interest in Africa’s beverage sector, particularly in premium beer and spirits markets. EABL’s well-established brands, distribution network, and operational capabilities make it a strategic target for companies looking to expand in emerging markets.

The divestment also marks a shift in Diageo’s portfolio management, reflecting the company’s focus on core global markets and high-growth categories such as premium spirits and ready-to-drink beverages.