Nairobi, Kenya: Kenya's government plans to sell a stake in a wines and spirits marketer to South Africa's Distell Group and to offload its shareholdings in three luxury hotels, its Privatization Commission said on Friday.

The commission did not say how much it expects to raise. The sales were first announced in 2011 as part of a plan to help improve the state's finances and to transfer the running of businesses to the country's private sector.

Kenya's 2012/13 budget assumes a deficit of Sh250.3 billion ($2.95 billion) or 6.5 percent of gross domestic product.

The government has large shareholdings across east Africa's biggest economy. It plans to retain stakes in strategic assets such as energy and telecoms.

The government will sell a 30 percent stake in Kenya Wine Agencies Limited (KWAL) to Distell and KWAL's employees, the privatisation agency said in a newspaper advertisement.

The commission also plans to offload several government stakes in large hotels, including a 40.57 percent shareholding in International Hotels Kenya Limited, which owns the Hilton Hotel in downtown Nairobi.

It will offload a 33.83 percent stake in Kenya Hotel Properties Limited, which runs the Intercontinental Hotel , and a 39.11 percent shareholding in Mountain Lodge, which operates under the TPS Serena brand.

The commission said the hotel sales would be through negotiations involving pre-emptive rights and that this and the sale of the 30 percent stake in KWAL were expected to be completed by June 30.

It said the rest of the shares in KWAL would be sold within two to four years.

The government owns shares in KWAL through the Industrial and Commercial Development Corporation (ICDC), while the Kenya Tourist Development Corporation holds its shares in the hotels.

Tourism is an important source of foreign exchange in the country of more than 40 million people, earning 96 billion shillings in 2012.

The government has previously also announced plans to sell its shareholding in the country's oil pipeline company and its main power producer, Kenya Electricity Generating Company

-Reuters