TANZANIA: Diageo's EABL to take Serengeti Breweries stake
Diageo's East African Breweries Ltd expects to acquire a stake in Serengeti Breweries in 2010.
East African Breweries Ltd (EABL) last week agreed to settle a court dispute with SABMiller over the acquisition of a stake in Serengeti, Tanzania's second largest brewer. EABL already has a 20% stake in SABMiller-owned Tanzania Breweries, the country's largest brewer.
Details of the settlement are strictly confidential, but a Diageo spokesperson confirmed to just-drinks today (1 March) that EABL intends to proceed with its plan to buy a "substantial interest" in Serengeti.
"The injunction has now been lifted so we are progressing with our intended transaction that was announced last year," said the spokesperson.
A deal is expected to be complete in calendar 2010, although the spokesperson declined to comment on whether this will be within Diageo's current fiscal year, which runs to the end of June.
As part of the deal, EABL will sell off its stake in Tanzania Breweries.
Diageo said of the deal, when announced last year: "Serengeti will form an integral part of EABL's East African supply footprint providing additional capacity to Kenya and Uganda."
The Guinness brewer said that Serengeti, which has gross assets worth around GBP38m (US$57.6m), has a 17% share of the Tanzanian beer market and has grown this by 10% in the last three years. Premium priced Serengeti Lager constitutes 85% of the group's volume sales.
Diageo has appointed Lord Mervyn Davies of Abersoch to its board effective 1 September 2010....
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