Reports claim Diageo looking to sell beer portfolio — but not Guinness

Reports have claimed that Diageo is seeking to sell its beer portfolio, although the news also states it will keep its Guinness brand.

The news comes from Axios that the firm is looking to off-load Smithwick’s, Kilkenny, Harp Lager in Ireland, and also East African Breweries’ Tusker lager.

However, according to the reports, the brand is looking to keep Guinness, which is one of its best sellers in the beer portfolio globally, and has continued to see year-on-year growth, especially in the UK, where it grew 7% on 2022 levels.

The spirits giant made £3.36bn in the year to 30 June 2023 from beer sales, which is around 14% of the firm’s total sales. Its spirits arm made more than 81% of all sales in the same period.

The news comes as Diageo increases its focus on Guinness, including upping Guinness 0.0 production by almost 300% following a €25 million (US$27.2m) investment into its St. James’s Gate site this summer, and only last week announced 1000 Irish pubs would serve the no-alcohol product on draught.

In addition, the firm has also appointed a new managing director and chief executive officer to head up its Guinness stout brand in Nigeria. From January 2024 Adebayo Alli will take the the leadership role taking over from Guinness Nigeria’s current MD and CEO John Musunga, who will instead be made the first managing director for Southern, West, and Central Africa (SWC).

The company also announced in September that it was open the doors on its 15,000 square foot Chicago brewery, which includes a brewery, taproom, restaurant and even a bakery, which followed its first US brewery that opened in Baltimore in 2018.

Diageo also produced stronger than expected results in August, with the group achieving net sales of £17.1 billion, up by 10.7%, primarily reflecting strong organic net sales growth and favourable foreign exchange movements, although volumes fell by 7.4%.

In its results, new chief executive Debra Crew also specifically mentioned Guinness, highlighting the brand as part of  the near-term opportunities to drive the business, including with ‘bolder and faster innovation’.

Commenting on the reports about selling its beer portfolio, a spokesperson for Diageo told db: “We do not comment on market speculation”.