Asahi moves for Diageo’s Kenya business in $2.3bn deal

Asahi Group Holdings is to wage $2.3bn for Diageo’s concern successful Kenya, which includes the UK group’s bulk involvement successful East African Breweries.

The Super Dry brewer is buying Diageo’s 65% involvement successful East African Breweries (EABL) and its 53.7% shareholding successful Kenyan spirits radical UDVK.

Earlier this year, it was reported Diageo had hired banking advisers to transportation retired a reappraisal of EABL, which markets brew brands including Tusker and Serengeti Lager.

Asahi said the concern “offers precocious maturation imaginable and unchangeable profitability”. Until now, the Peroni marque proprietor has exported to Africa. The woody marks Asahi's archetypal acquisition of assets successful the region.

The Japanese radical added: “Our nonsubjective is to found a instauration for medium- to semipermanent maturation by acquiring a starring level successful Kenya and the eastbound African market, which is expected to present semipermanent maturation driven by colonisation summation and economical expansion.”

The merchantability is not the archetypal Diageo has made successful Africa this year. In February, the institution agreed a woody to offload its involvement successful the publically listed Guinness Ghana Breweries to French drinks radical Castel for $81m.

That transaction followed different disposals successful Africa. In 2024, the Tanqueray gin proprietor offloaded its shareholding successful publicly-listed Guinness Nigeria to Singapore-based user radical Tolaram. Two years earlier, Diageo sold its Guinness brewing cognition successful Cameroon to Castel.

Under the presumption of the woody with Asahi, Diageo said it would “enter into semipermanent licensing agreements arsenic good arsenic transitional work agreements” with EABL. There volition beryllium caller deals for EABL to nutrient Diageo spirits brands including Smirnoff and Captain Morgan arsenic good arsenic Guinness nether licence.

Nik Jhangiani, Diageo’s interim CEO, had said successful May the radical could marque “substantial changes” to its merchandise portfolio successful the signifier of plus disposals adjacent aft the merchantability of a clutch of spirits brands successful caller years and the erstwhile transactions successful Africa.

He said today: “This transaction delivers some important worth for Diageo shareholders and accelerates our committedness to fortify our equilibrium sheet. We stay committed to returning the radical to good wrong our people leverage ratio scope of 2.5 to 3 times done disposals of non-strategic, non-core assets, alongside delivering affirmative operating leverage, and tighter superior discipline.”

Asahi said it would support the listing presumption of the publically traded EABL and does not program to instrumentality its involvement beyond 65%.

CEO Atsushi Katsuki added: “This concern is simply a high-quality, starring institution successful Kenya, Uganda, and Tanzania, with an unrivalled marque portfolio and selling capabilities, state-of-the-art accumulation facilities and beardown marketplace shares. Together with its fantabulous absorption squad and employees, we volition prosecute sustainable maturation and medium- to semipermanent enhancement of firm value, portion contributing to the improvement of the section economies.”