Diageo (NYSE:DEO) has reached an agreement to sell its 65% stake in East African Breweries (EABL) and its 53.68% share in UDVK to Japan’s Asahi Group for an estimated net gain of $2.3 billion after taxes and transaction costs.
The deal, which implies an enterprise value for EABL of $4.8 billion—about 17 times adjusted EBITDA—marks a major step in Diageo’s ongoing strategy to streamline its portfolio and de-lever its balance sheet.
The sale will reduce Diageo’s leverage by approximately 0.25x, positioning the company for stronger financial flexibility.
The transaction, which is still subject to regulatory approvals, is expected to close in the second half of 2026. As part of the agreement, Diageo will enter into long-term licensing and transitional service agreements with Asahi, securing the continued production and distribution of key brands such as Guinness and select spirits in East Africa.
These agreements will help ensure smooth continuity in markets where Diageo has a well-established presence.
For the fiscal year ending June 30, 2025, East African Breweries reported net sales of $996 million, EBITDA of $258 million, net income of $94 million, and net debt of $229 million.
The deal reflects a robust valuation for EABL, a key player in the East African beverage market, and positions Asahi to expand its footprint in a growing regional market.