Diageo is reportedly exploring the sale of its Chinese assets as part of a major portfolio review under its new chief executive, Dave Lewis. The owner of Guinness and Johnnie Walker has begun working with Goldman Sachs and UBS to assess its operations in China, where sales have been weakening.
Diageo’s Chinese holdings include a majority stake in Sichuan Swellfun, a Shanghai-listed producer and distributor of baijiu. Shares in Swellfun have fallen sharply over the past year amid slowing demand, prompting banks to sound out interest from Chinese strategic buyers and private equity firms. The reported review comes as Lewis, who took over in January, begins streamlining the world’s largest spirits maker after a career marked by aggressive restructuring at Unilever and a turnaround at Tesco.
Diageo is facing multiple pressures, including high debt, changing consumer habits among younger drinkers, and the impact of trade tariffs linked to Donald Trump. The company recently warned of a double-digit sales decline in China and has already begun trimming its global footprint, selling its stake in East African Breweries to Asahi Group. The strategic shift follows a turbulent period under former CEO Debra Crew, whose tenure was marked by profit warnings and supply issues, including a high-profile Guinness shortage in the UK.
