Court Declines To Stop Diageo From Selling Its EABL Stake

The High Court has declined to stop Diageo from proceeding with the sale of its stake in East African Breweries PLC (EABL) to Asahi.

This follows an application by Bia Tosha seeking to restrain Diageo from disposing of its Ksh303.6 billion shareholding in EABL to the Japanese beverage giant. The interim conservatory order issued on January 20, 2026, which barred the parties from taking final steps toward completion of the transaction, lapsed on Thursday, February 26, 2026, prompting Bia Tosha to seek its extension.

“The Respondents, including EABL, opposed the request on the basis that there was no legal or factual basis to extend interim restraints. The Court declined to issue any orders,” EABL said in a statement on Thursday.

The presiding judge informed parties that he will be transferred to Kiambu Law Courts effective April 1, 2026, and directed that the matter be mentioned before the incoming judge on April 9, 2026, a date agreed upon by all parties.

“EABL welcomes this outcome. The transaction remains subject to the applicable regulatory processes and approvals. EABL will continue to cooperate fully with the relevant authorities and will participate in the court process as directed. Business operations remain unaffected,” the company said.

Stake Sale

In December 2025, Diageo announced that it had entered into an agreement to sell its 100% shareholding in Diageo Kenya Limited — which holds a 65% stake in EABL — to Asahi. The transaction also includes Diageo’s interests in the Kenyan spirits business, UDVK.

Asahi is a Japanese-listed global beverage company with a diverse portfolio spanning beer, alcoholic and non-alcoholic beverages, as well as food products.

The deal includes Diageo’s 53.68% directly owned shareholding in UDVK, a Kenya-based spirits producer and importer. EABL, which owns the remaining 46.32%, retains management control and fully consolidates UDVK in its financials.

EABL remains the largest beer business in East Africa.

Under the agreement, Diageo committed to enter into long-term licensing and transitional service agreements with EABL. Locally owned brands such as Tusker and Kenya Cane will remain under EABL ownership. Refreshed agreements will allow EABL to continue producing certain Diageo spirits, including Smirnoff and Captain Morgan, as well as ready-to-drink brands such as Smirnoff Ice and Orijin. The iconic Guinness brand will also continue to be produced under licence, alongside the importation and distribution of Diageo’s international premium spirits.

“We are incredibly proud of the achievements of EABL and our colleagues across Kenya, Uganda and Tanzania. EABL and Diageo have built the largest beer business in East Africa, a testament to driven people with a passion for the consumers and communities they serve. We are excited to partner with Asahi through the licensing of Diageo brands in the region going forward,” said Nik Jhangiani, Interim Chief Executive Officer of Diageo, in December 2025.

He added: “This transaction delivers both significant value for Diageo shareholders and accelerates our commitment to strengthen our balance sheet. We remain committed to returning the Group to well within our target leverage ratio range of 2.5–3.0x through disposals of non-strategic, non-core assets, alongside delivering positive operating leverage and tighter capital discipline. This disposal, alongside the recent announcement by USL to conduct a strategic review of its ownership of RCB, represents material steps in delivering on this commitment.”

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

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