High Court Postpones Case Seeking to Block Diageo’s EABL Deal

A legal dispute in Kenya has delayed the planned sale of East African Breweries Limited (EABL) by global drinks giant Diageo Plc to Japan’s Asahi Group Holdings.

The High Court has moved the hearing to January 20, 2026, giving the parties more time to prepare and allowing preliminary steps, such as regulatory filings, to continue.

The case was filed by Bia Tosha Distributors Limited, a local beer distributor, which argues that the sale should be halted until a separate dispute dating back to 2016 is resolved.

The company says completing the transaction could make it harder to enforce any future legal claims against Diageo or EABL. EABL, however, maintains that the case is unrelated to the sale.

The deal, first announced in December 2025, sees Diageo selling its 65 per cent stake in EABL and a 53.68 per cent stake in UDV Kenya, a spirits producer, to Asahi for roughly $2.3 billion (Ksh 296.5 billion). This effectively values EABL at about $4.8 billion (Ksh 619 billion) and marks Diageo’s exit from direct beer ownership in East Africa.

Diageo said the sale is part of a broader effort to reduce debt, streamline operations, and focus on core markets, amid U.S. tariffs and changing consumer trends.

Asahi plans to retain EABL’s listing on the Nairobi Securities Exchange, as well as exchanges in Uganda and Tanzania, and will operate the company while licensing key Diageo brands like Guinness, Smirnoff, and Captain Morgan. EABL’s local brands, including Tusker, Senator, and Serengeti, will remain under its control.

For the fiscal year ending June 2025, EABL reported net sales of $996 million, EBITDA of $258 million, and net income of $94 million, with net debt of $229 million. The company remains one of the largest brewers in East Africa, with operations across Kenya, Uganda, and Tanzania.

The court’s decision allows regulatory work to proceed, but the transaction cannot be finalised until after January 20, when Judge Bahati Mwamuye will give further directions. The deal is expected to close in the second half of 2026, pending approvals.