SABMiller and Diageo have agreed to settle a dispute between the two groups’ brewing subsidiaries in Tanzania.

Diageo’s East African Breweries Ltd (EABL) looks set to go ahead with its plan to ditch a 20% stake in SABMiller-controlled Tanzania Breweries and invest in a rival brewer in the country.
 
In August 2009, SABMiller obtained a court injunction in the UK that temporarily blocked EABL’s acquisition of a “substantial interest” in Serengeti Breweries. Serengeti is Tanzania’s second largest brewer behind Tanzania Breweries (TBL).

Diageo and SABMiller said today (25 February) that they have withdrawn “all claims and counterclaims in the arbitration” and will not pursue “any further actions” on the matter.

“TBL will cease to brew and distribute EABL’s brands in Tanzania following a transitional period,” said the firms.

“TBL and SABMiller International BV’s brands will continue to be brewed and distributed in Kenya,” they added. Kenya is EABL’s home market.

SABMiller said separately: “SABMiller has reaffirmed its commitment to grow relevant TBL brands in Kenya, which reflects the spirit of the recently signed Protocol on the Establishment of the East African Common Market.”

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Neither firm would comment further, describing the terms of the deal as “strictly confidential”.

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