Diageo, the global spirits behemoth behind Tusker, Guinness, and Johnnie Walker, is reportedly looking to cash out of China. The company is considering selling its assets in the Asian giant as it seeks to trim fat from its portfolio under new CEO Dave Lewis.

According to reports, Diageo is working with Goldman Sachs and UBS to find a buyer for its 63% stake in Sichuan Swellfun, a maker of the traditional Chinese spirit *baijiu*. The move signals a strategic retreat from a market where consumer spending on premium alcohol has nose-dived.

"Drastic Dave" Strikes Again

Dave Lewis, known in business circles as "Drastic Dave" for his cost-cutting ruthless streak at Tesco and Unilever, is wasting no time. Since taking the reins on January 1, he has been reviewing Diageo’s global footprint. China, with its double-digit sales decline and fierce local competition, seems to be the first casualty.

• The Asset: A controlling stake in Sichuan Swellfun, valued at over £2 billion.
• The Reason: Chinese drinkers are tightening their belts, and younger consumers are drinking less alcohol overall.
• The Local Angle: While this sale affects China, Diageo’s commitment to East African Breweries (EABL) remains a cornerstone of its emerging market strategy, having recently consolidated its stake.

Focusing the Portfolio

For investors, this is a sign of discipline. Diageo is shedding dead weight to focus on high-growth markets—like Kenya. While the Chinese may be toasting with less *baijiu*, the plan is to keep the Guinness flowing in Nairobi.