British multinational brewer Diageo Plc is grappling with asset losses and legal battles in several African countries as it seeks to exit parts of the continent’s beer market, highlighting the difficult operating conditions facing foreign investors.

 

The company is fighting a multimillion-dollar legal battle over its planned exit from East African Breweries Ltd (EABL) after posting estimated losses of about $365 million from the sale of assets in Ethiopia, Nigeria and Ghana.

The firm is restructuring much of its global business as it seeks to reshape its beer portfolio, which is seen as lower margin and harder to scale profitably.

In 2025, Africa accounted for nine percent of Diageo’s sales, the same share as Latin America and the Caribbean.

A huge chunk of the group’s sales came from North America (40 percent), followed by Europe (24 percent) and Asia Pacific (18 percent). North America remains Diageo’s largest market and accounts for more than one-third of its net sales.“We have made a number of selective disposals consistent with our long-term strategy of deleveraging and improving balance sheet flexibility. This includes the sale of non-core brands Pampero, Safari and Cacique, as well as a shift to an asset-light model in many parts of Africa, with the disposal of shareholdings in Guinness Nigeria, Guinness Ghana and Seychelles Breweries,” the company says in its latest annual report for 2025.“Going forward, we remain committed to actively pursuing disposals of appropriate, non-core assets. We have made progress this fiscal, but there is clearly more work to do.”Asset shiftAn asset-light business strategy reduces a company’s ownership of capital-intensive physical assets such as manufacturing plants and vehicle fleets and allows it to rely on outsourcing, leasing and digital platforms while maintaining a flexible cost structure.

On April 25, 2022, Diageo completed the sale of its Ethiopian subsidiary, Meta Abo Brewery Share Company, to Castel, resulting in a loss of £95 million ($125.6 million).

On September 30, 2024, Diageo completed the sale of its 58.02 percent shareholding in Guinness Nigeria Plc to Tolaram, with the transaction resulting in a loss of $125 million.

On January 28, 2025, Diageo announced the sale of its 80.4 percent shareholding in Guinness Ghana Breweries Plc to Castel Group, a transaction that resulted in a loss of $114 million.

Asset disposals in other markets, such as Cameroon and Seychelles, generated significant gains.

On May 26, 2023, Diageo completed the sale of Guinness Cameroun SA for $475 million, resulting in a gain of $343 million.

On April 2, 2025, the group announced the sale of its 54.4 percent shareholding in Seychelles Breweries Ltd to Phoenix Beverages. The transaction was completed on July 1, 2025, for about $80 million.

The company is looking to divest much of its beer portfolio apart from its flagship Guinness brand and has already moved to separate brewing operations by offloading several beer-related assets across Africa.

In May 2025, the company launched the first phase of its Accelerate programme, a company-wide initiative aimed at building a more agile operating model, with clear cash-delivery targets and a disciplined focus on operational excellence and cost efficiency.

Under the programme, the company aims to deliver sustained performance, including $3 billion in free cash flow annually from fiscal year 2026, and achieve $625 million in cost savings over three years to support reinvestment and improve operating leverage.“These changes are creating a stronger platform for optimising investment and enabling more effective resource allocation towards long-term growth,” the company says.

As a result, Diageo has transitioned towards an asset-light framework, selling several African subsidiaries and shifting increasingly towards licensing arrangements and third-party operators.

A shift towards an asset-light strategy in Africa and the associated divestments has driven a significant pivot towards third-party production and distribution.“The Beer Category Third-Party Operations team’s focus is on maintaining secure supply solutions through partners while assuring the consistent quality of Diageo brands produced at third-party facilities and enhancing Diageo value through supporting the start-up of new partnerships and delivery of innovation projects,” the company says.

EABL battleDiageo has also entered into an agreement to sell its 65 percent majority stake in East African Breweries Ltd (EABL) to Japanese beverage giant Asahi Group Holdings for $2.3 billion, but the planned transaction faces a series of lawsuits from minority shareholders and third parties that are delaying its conclusion.

Under the deal, Asahi agreed to acquire Diageo Kenya Ltd, which holds a 65 percent stake in EABL, as well as Diageo’s stake in UDV Kenya.

Diageo’s African challenges include currency volatility, shifting regulatory hurdles, taxation pressures and legal battles that continue to complicate its exit from some markets.

Diageo is among several British companies scaling down operations on the continent and redirecting resources to investments and markets they consider to offer stronger growth and returns.

UK firms including Barclays Plc, Standard Chartered Plc and Atlas Mara Ltd, which had acquired seven African banks, have also reduced their footprint in parts of Africa.

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