BUSINESS

Court Lifts Block on EABL Sale, Paving Way for Asahi Takeover

SABRINA BTApr 10, 20262 Mins read254

East African Breweries PLC (EABL)

A planned multibillion-shilling takeover of East African Breweries PLC (EABL) has been given the green light after the High Court threw out a case that had temporarily stopped the deal.

In a ruling, the court lifted all earlier orders that had blocked the transaction, effectively allowing the process to move forward after months of hurdles.

The case had been filed by logistics firm Bia Tosha, which has been locked in a long-running dispute with EABL and its parent company Diageo. The disagreement centres on distribution rights and compensation claims that date back several years.

Bia Tosha had argued that the sale should not proceed before its dispute is resolved, but the court declined to stop the transaction any further in February 2026.

“This decision allows the transaction to proceed to completion through standard regulatory channels,” EABL said.

Ksh 296.5 billion deal

The deal, estimated at Ksh 296.5 billion, will see Japan’s Asahi Group Holdings acquire a controlling stake in EABL from Diageo. It is one of the largest transactions in the region’s beverage industry in recent years.

The acquisition also covers UDV (Kenya) Limited, meaning Asahi will take over both beer and spirits operations, bringing them under one main majority owner. Once finalised, Asahi will control EABL’s business across Kenya, Uganda, and Tanzania.

This deal has been in the works since last year, when Diageo first signalled its intention to restructure its African operations. At the time, the company indicated it was reviewing its holdings to focus on key global markets while unlocking value from its regional subsidiaries.

Hurdles to the EABL sale

However, the process has not been smooth.

Apart from the court case filed by Bia Tosha, the transaction has had to go through multiple regulatory approvals across East Africa, including competition authorities and capital markets regulators. There have also been concerns raised in industry circles about market dominance, given EABL’s strong position in the region’s alcohol sector.

The dispute with Bia Tosha became one of the biggest hurdles. The logistics firm claimed it had been unfairly pushed out of distribution contracts and was owed compensation, prompting its attempt to block the sale through the courts. The interim orders issued earlier had briefly cast doubt on whether the deal would proceed on schedule, creating uncertainty among investors and partners.

Despite these challenges, EABL and Diageo maintained that the transaction was commercially sound and would strengthen operations in the long term.

Insiders say the companies remained confident throughout the legal battle, pointing to ongoing engagements with regulators and stakeholders across the region.

Analysts say Asahi’s entry into the East African market signals growing global interest in Africa’s consumer sector, particularly in beverages, where rising urban populations, a youthful demographic, and changing consumption habits are driving demand.

Market watchers also expect that Asahi could introduce new brands, improve supply chains, and invest in local production capacity once it takes control.

There is also speculation that the company may review existing distribution models, which could have implications for current partners and logistics firms.

If completed, the deal is expected to reshape the region’s alcohol industry, with Asahi bringing in new capital, strategy, and possibly changes in how the business is run. For Diageo, the sale is part of a wider effort to streamline operations and focus on markets where it retains full control.

For now, the court’s decision clears a major obstacle, setting the stage for the final steps of a deal that has been closely watched by investors, regulators, and industry players alike.

The transaction will now proceed through the remaining regulatory and procedural stages before it can be fully concluded.