UK-based drinks giant Diageo has agreed to purchase a 20 per cent share in Kenya Breweries Limited (KBL) from SABMiller, through its subsidiary East African Breweries Limited (EABL).
The sale, announced today, is subject to KBL agreeing to terminate a brewing and distribution agreement with SABMiller, which will also see it ceasing to distribute SABMiller's brands in Kenya after a short transitional period.
In turn, EABL will be disposing of its 20 per cent shareholding in Tanzania Breweries Limited (TBL) through a public offering. EABL and SABMiller entered a deal around 10 years ago that allowed SABMiller to sell EABL brands through TBL. EABL reciprocated by brewing and marketing SABMiller products, such as Castle Lager, in Kenya.
The KBL plant has a total brewing capacity of 2,500,000 hectolitres per year.
The value of the deal is $225 million, Diageo said.
With the largest share of the beer industry in the region, EABL has an annual turnover of 35 billion Kenyan shillings. The group employs more than 1,000 people across East Africa.
Trading in approximately 180 markets, Diageo employs over 20,000 people around the world. With offices in 80 countries, the company has manufacturing facilities across the globe in locations such as the UK, Ireland, the US, Canada, Spain, Italy, Africa, Latin America, Australia, India and the Caribbean.
Diageo brands include Johnnie Walker, Smirnoff, Baileys, José Cuervo and Guinness.
