SABMiller settles dispute with Diageo

Under the terms of the agreement, EABL will continue to brew and distribute SABMiller brands in Kenya, and both groups have also agreed to withdraw all claims and counter claims in arbitration in London and “not to pursue any further actions in respect of the matters”. Both parties involved say they will not comment further.

But the solution to their dispute allows speculation that EABL got the green light to finally buy Serengeti Breweries, Tanzania’s second largest brewing operation and maker of the popular Serengeti Lager. In 2009, Serengeti Breweries accounted for 17 percent of the 2.9 million hl Tanzanian beer market by volume, having boosted its market share by 10 percent since 2006, Diageo said. Serengeti Lager, a premium priced product, is the brewer’s flagship brand and represents about 85 percent of its sales volume.

Diageo has a 50.03 percent stake in EABL, which itself has a 20 percent stake in Tanzania Breweries. Meanwhile, SABMiller holds a 52.83 percent in Tanzania Breweries. Serengeti Breweries is owned by a group of private investors.