Japanese beverage maker Asahi Group Holdings has said it will ride on newly introduced international premium beer brands to grow its business in the East Africa region, after completing its majority investment in East African Breweries Plc (EABL).
Asahi Group President and Chief Executive Atsushi Katsuki told the company’s shareholders that the multinational will introduce its Asahi Super Dry and Peroni Nastro Azzurro lagers into the Kenyan market to complement EABL’s White Cap and Guinness Stout in the premium segment of the beer market.
The Japanese firm’s emphasis on premium beers will mark a shift in strategy from EABL’s current majority owner Diageo Plc -the world’s largest spirits group- under which the listed brewer has increasingly leaned on spirits such as Johnnie Walker and Kenya Cane for growth in the local market.
In the year ending June 2026, EABL reported that its spirits segment recorded a 30 percent growth in net sales value, higher than the growth of nine percent for each of mainstream and premium beers. The company’s top line sales grew 13.3 percent to Sh145.96 billion, and net profit by 49 percent to Sh18.23 billion.
Mr Katsuki disclosed that discussions held so far with EABL’s management have focused on expectations surrounding Asahi’s expertise in the beer sector, and how to inject it into EABL brands to advance the whole value chain, including manufacturing and marketing.
He noted that the beer market in East Africa is currently dominated by low-price and mainstream categories, but there is room for growth in premium brands on the back of sustained economic growth and urbanisation.
‘Diageo Plc’s Guinness brand has established a solid market position in the premium category, but pilsners and other global mainstream premium lager brands have a limited presence. In my opinion, there is plenty of room for the Asahi Group to develop Asahi Super Dry and Peroni Nastro Azzurro premium lager and other brands in the region,’ said Mr Katsuki.
‘Indeed, we are eager to build a multi-layered product portfolio in East Africa by leveraging EABL’s robust distribution platforms and expanding Asahi Group brands in the region.’
Diageo and Asahi agreed the sale of the 65 percent stake in EABL held via an investment vehicle known as Diageo Kenya for a consideration of $2.354 billion (Sh305.5 billion) in December 2025.
Asahi also agreed to purchase Diageo’s 53.68 percent holding in spirits producer and importer UDV Kenya for $646 million (Sh83.8 billion), taking the total size of the deal to Sh389.3 billion.
Under the deal, EABL will retain Tusker and other local brands, while also signing agreements with Diageo to continue producing Guinness and some spirits, while importing and distributing others.
Diageo will also renew agreements with EABL to produce some of its spirits such as Smirnoff and Captain Morgan, and ready to drink brands such as Smirnoff Ice and Origin on licence terms. These will be complemented by the brands that Asahi will introduce into the market.
The Japanese company, which is listed on the Tokyo Stock Exchange, produces a diverse range of beer, alcoholic and non-alcoholic beverages, and food brands. Its business portfolio has revolved around Japan and East Asia, Europe, and the Asia-Pacific region, with annual sales revenue of more than $19 billion (Sh2.46 trillion).
The company has however been eyeing an East African entry for the past decade, saying that demand for beer is anticipated to rise against a backdrop of population and economic expansion.
‘While the region is more politically and economically volatile than Japan or Europe, population growth, urbanisation, and economic expansion have supported higher medium-to long-term income growth, with beer demand expected to expand and premiumisation to evolve accordingly,’ said Mr Katsuki.
Asahi and Diageo anticipated closing the EABL sale transaction within the second half of this year, having obtained regulatory approvals from the East African markets in which they operate.
In Kenya, the Competition Authority of Kenya (CAK) granted a conditional approval on terms that the merged entity allows rival brands 20 percent of the space in the refrigerators it provides to retail outlets.
Further, the CAK directed the parties to set aside enough funds to cover future liabilities, which include potential awards in ongoing court cases against EABL.
However, Asahi and Diageo will wait longer to transfer the EABL shares after the High Court (in early September) extended a June 2026 freeze on the transfer of the EABL shares following an opposing petition on the sale.
The petition was filed by EABL shareholder Christine Irungu, who argued that minority owners were denied material information when Diageo increased its stake in the brewer from 50.03 percent to 65 percent in 2023 before pursuing the sale to Asahi.
She further argued that Diageo’s acquisition of the additional shares was presented as a long-term investment demonstrating its confidence in East Africa’s growth prospects, meaning that the subsequent decision to sell the enlarged stake would raise questions about whether investors received full disclosure of material information when the tender offer was undertaken.
On their part, Diageo Kenya and Diageo Plc have been seeking to have these orders set aside, arguing that the issues raised by the petitioner fall within specialised statutory frameworks governing takeovers, mergers and competition regulation, and should therefore be handled by the relevant regulators and tribunals.