Diageo Unit Seals Kenyan Excise Breakthrough

Diageo's East African brewing unit East African Breweries Ltd (EABL) has been strengthened after Diageo reached an accord with the Kenyan government to scrap excises on EABL's low-cost Senator beer brand. Bearing in mind that inexpensive informal beer remains a formidable force in the country, the loosened excise stance should gradually strengthen EABL's grip of the underdeveloped segment, which would be particularly timely given tougher trading conditions in Kenya. The Kenyan market, which contributes about 70% to EABL's consolidated volumes (its market share is in excess of 90%), has come under pressure in 2009 as economic weakness and hefty excises

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