Diageo acquired the brewery in 2012, and then tripled its capacity in 2015 to 1.7m hl with a bottling line expansion: citing the need to meet future demand and support new product innovations.
Investment in the brewery, including the acquisition and subsequent expansion, was valued at $344m.
Diageo currently has 13 breweries in Africa and 10 facilities which provide blending, malting and bottling services.
It already has a relationship with Castel Group, which is one of its contract brewers in the region.
Active in Ethiopia since 1998, BGI Ethiopia produces and distributes beer and wine across the country as well as further afield.
"Diageo has entered into an agreement for the sale of Meta Abo Brewery, its brewery in Sebeta, Ethiopia, to BGI, part of Castel Group. The sale is subject to approval by the Ethiopian Competition Commission and certain conditions. It is expected that the deal will complete early in 2022.
"Diageo will continue to service the Ethiopian market with its international spirits portfolio through its dedicated imported spirits channel. Sale proceeds have not been disclosed," says a statement from the company.