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Diageo has confirmed the sale of its 80.4% shareholding in Guinness Ghana Breweries to Castel Group for $81 million.

This transaction comes after a period of speculation regarding Diageo's intentions in the West African market, during which the company had refuted rumours of a potential sale.

In recent months, various media outlets reported on the possibility of Diageo divesting its stake in Guinness. However, Diageo officials had publicly dismissed these rumours, asserting that the company was committed to its operations in the region.

The recent announcement marks a significant shift in Diageo's strategy, as the company seeks to optimise its portfolio and strengthen its partnerships in Africa.

Under the terms of the agreement, Diageo will retain ownership of the Guinness brand and other products currently produced by Guinness Ghana, including Malta, Orijin, Smirnoff Ice and Alvaro.

These brands will continue to be manufactured under a long-term licensing and royalty arrangement, allowing Diageo to maintain control over brand management and marketing strategies in collaboration with Castel.

Diageo's asset-light operating model allows for flexibility in market approaches, enabling the company to adapt based on local conditions for improved efficiency and profitability. Castel Group, a well-established player in West and Central Africa, has partnered with Diageo in 11 other markets, reinforcing a commitment to growth in the region.

This sale follows a series of strategic maneuvers by Diageo, including the divestment of its shareholding in Guinness Nigeria to Tolaram in September 2024 and the establishment of a dedicated spirits company to enhance its presence in West Africa. The company also sold Guinness Cameroon to Castel in July 2022.

Diageo's operations in Africa include East African Breweries Limited, serving Kenya, Tanzania and Uganda, and Diageo South West Central. The company maintains a presence in 34 countries, supported by a network of strategic distributors for both beer and spirits.

Dayalan Nayager, president of Diageo Africa, said: “Guinness Ghana is performing strongly powered by a fantastic team of people. Through this transaction, I look forward to the Guinness brand continuing to thrive and delivering further growth. I am excited to extend our partnership with Castel, a long-term partner in the region with a proven track record. ”

Gregory Clerc, CEO of Castel, added: “This acquisition exemplifies the entrepreneurial spirit that drives Castel and marks a new milestone in our growth ambition. It reflects our ability to go where we are least expected, exploring new horizons on a continent full of opportunities. With this 22nd African country, we reaffirm our dynamism, our boldness and our confidence in Africa’s potential.”

Following the completion of the transaction, Guinness Ghana will remain listed on the Ghanaian Stock Exchange. The deal is expected to close within the calendar year, pending regulatory approvals.

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