![\"Guinness](\"https:\/\/dailybusinessgroup.co.uk\/wp-content\/uploads\/2019\/04\/Guinness-pack.png\")
Diageo is selling its 65% stake in East African Breweries (EABL) for $2.3 billion to Asahi, marking the first time a Japanese giant has made a major investment in an African\u00a0alcohol business.<\/p>\n
The owner of Johnnie Walker whisky and Guinness said the sale is part of its strategy of offloading non-core brands and reducing debt. Last year it sold its 58% shareholding in Guinness Nigeria.<\/p>\n
Asahi, whose brands include Peroni and Grolsch, intends to preserve local products while introducing globally-recognised names from its portfolio to consumers in East Africa. <\/p>\n
EABL is the largest beer business in East Africa with a heritage that dates back over a century and has delivered a strong growth track record in Kenya, Uganda and Tanzania. <\/p>\n
Diageo has committed to enter into long term licensing agreements as well as transitional service agreements with EABL.\u00a0Locally-owned brands, such as Tusker and Kenya Cane, will remain owned by\u00a0EABL.<\/p>\n
There will be refreshed agreements for\u00a0EABL to produce certain Diageo spirits (e.g. Smirnoff, Captain Morgan) and ready-to-drink brands (e.g. Smirnoff Ice, Orijin), as well as the iconic Guinness brand under licence and the import and distribution of Diageo international premium spirits.<\/p>\n
Nik Jhangiani, interim chief executive at Diageo, said:\u00a0\u201cWe are incredibly proud of the achievements of EABL and our colleagues across Kenya, Uganda and Tanzania.<\/p>\n
\u201cEABL and Diageo have built the largest beer business in East Africa, a testament to driven people with a passion for the consumers and communities they serve. We are excited to partner with Asahi through the licensing of Diageo brands in the region going forward.\u201d<\/p>\n
Diageo said the transaction delivers both significant value for its shareholders and accelerates its commitment to strengthen its balance sheet.<\/p>\n
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