• Asahi Group Holdings agreed to acquire Diageo’s East African operations, subject to regulatory approvals.

• The transaction values Diageo Kenya Limited at $2.35 billion and grants Asahi indirect control of East African Breweries Plc.

• The deal marks Asahi’s first entry into East Africa, a fast-growing alcoholic beverages market.

Japan’s Asahi Group Holdings announced on Wednesday, December 17, that it signed agreements to acquire the East African operations of British spirits maker Diageo. Asahi stated in a release on its website that the transaction remains subject to regulatory approvals and should close in the second half of 2026.

A Strategic Investment Exceeding $2 Billion

The transaction includes Asahi’s acquisition of 100% of Diageo Kenya Limited (DKL), valued at $2.35 billion. The deal also includes the purchase of 53.68% of United Distillers Vintners Kenya (UDVK) for $646 million.

If regulators approve the transaction, Asahi Group Holdings will indirectly hold a 65% stake in East African Breweries Plc (EABL). EABL operates as the regional holding company for Diageo’s main subsidiaries in East Africa.

With this acquisition, Asahi will establish its first operational footprint in East Africa. The group previously held no presence in the region and now aims to secure a long-term position in a fast-growing market.

“Our objective is to lay the foundations for medium- and long-term growth by acquiring a leading platform in Kenya and East Africa, a region whose long-term growth should be supported by population growth and economic expansion,” the Japanese group said.

EABL ranks among the region’s leading brewing groups. The company markets beers, spirits, and ready-to-drink beverages in Kenya, Uganda, and Tanzania.

Its portfolio includes flagship beer brands such as “Tusker,” “Serengeti,” and “Bell Lager.” The portfolio also includes international spirits brands such as “Johnnie Walker,” “Smirnoff,” and “Captain Morgan.”

At the close of its 2025 fiscal year, EABL reported a 4% increase in revenue to 128.8 billion Kenyan shillings ($999.1 million). The company also posted a 12% rise in net profit to 12.2 billion shillings ($94.6 million).

A Favorable Context for Market Entry

Diageo aligned its decision to sell its EABL stake with a broader strategy focused on selective divestments of non-core assets. The British group aims to strengthen its balance sheet and reduce debt through these disposals.

In its 2025 annual report, Diageo reported net debt of $21.8 billion.

The EABL divestment did not mark an isolated move in Africa. Since 2024, Diageo has already sold its stakes in Guinness Nigeria, Guinness Ghana Breweries Ltd, and Seychelles Breweries Ltd (Seybrew).

Africa remains among Diageo’s lowest-performing regions by sales. In fiscal year 2025, Diageo generated global revenue of $20.2 billion.

North America accounted for 40% of sales, while Europe contributed 24% and Asia-Pacific delivered 18%. Africa and Latin America and the Caribbean each represented 9% of total revenue.

Market participants will now assess whether Asahi’s arrival, as a new Asian entrant in a market historically dominated by European and U.S. groups, will alter competitive dynamics in East Africa’s brewing industry.

This article was initially published in French by Stéphanas Assocle

Adapted in English by Ange Jason Quenum