East African Breweries PLC (EABL) has issued a detailed statement to clarify the sequence of events surrounding its recent medium-term note (MTN) issuance and the subsequent announcement by Diageo Plc to exit its shareholding in the company.

The clarification follows questions from investors on why EABL went to the market with a Ksh20 billion MTN programme before Diageo announced plans to sell its 65 per cent stake to Japan’s Asahi Group Holdings.

In a notice dated December 18, 2025, EABL said the proposed sale is a shareholder-level transaction between Diageo and Asahi and does not involve EABL. The brewer confirmed that it is not a party to the transaction and did not participate in negotiations between the two global drinks groups.

“The transaction is between Diageo and Asahi as strategic industry-leading shareholders. EABL is not a party to it, nor has it been involved in the transaction. EABL’s Board of Directors (the Board) was first notified of the Transaction on the afternoon of 16 December 2025,” the notice read.

EABL said its board first received notice of Diageo’s decision on the afternoon of December 16, 2025, several weeks after the company had already launched and executed the first tranche of its MTN programme. The MTN programme was announced on October 27, 2025, with the first tranche of Ksh16.76 billion issued on November 18, 2025.

According to the company, Diageo managed the transaction independently and made the decision to divest during 2025 due to global developments affecting its business. EABL said Diageo had no intention of selling its stake at the time it increased its shareholding to 65 per cent through a tender offer in 2023.

EABL stressed that its board and management are bound by strict disclosure rules and fiduciary duties, which require a clear separation between company-level financing activities and shareholder transactions. As a result, EABL said there was no basis for disclosing the Diageo–Asahi transaction in the MTN information memorandum issued in October 2025.

The brewer also assured investors that the MTN programme remains unaffected by Diageo’s planned exit. EABL said the bond issue is an independent financing arrangement and has no impact on its financial performance, balance sheet or ability to meet repayment obligations.

Strong demand

The clarification also comes amid strong demand for EABL’s recent bond issue, which the company says reflects continued investor confidence in its credit profile and strategy.

EABL concluded the first tranche of its Ksh20 billion domestic medium-term note programme in November after the offer was oversubscribed by 52.4 per cent. The brewer raised Ksh16.76 billion against an initial target of Ksh11 billion, prompting it to exercise a Ksh6 billion green-shoe option to meet demand.

All bids received were accepted, resulting in a 100 per cent allotment rate. The five-year notes carry an annual coupon of 11.8 per cent and will mature on November 18, 2030, with interest paid semi-annually in May and November.