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Kenya court clears Diageo sale of EABL stake to Asahi in $2.3bn deal
Kenya court clears Diageo sale of EABL stake to Asahi in $2.3bn
About this update from Diageo Plc
A Kenyan court has dismissed a legal challenge seeking to block Diageo (LSE: DGE, NYSE:DEO) from selling its controlling stake in East African Breweries Limited (NSE: EABL) to Asahi Group Holdings (TYO: 2502) of Japan , removing a key obstacle to one of the country’s largest corporate transactions, Reuters reported. Diageo is a British multinational alcoholic beverages company and one of the world’s largest producers of spirits, beer and ready-to-drink products. Its portfolio includes global brands such as Johnnie Walker whisky, Guinness beer, Smirnoff vodka, Baileys liqueur and Tanqueray gin. The High Court rejected a petition filed by local distributor Bia Tosha , which had sought to halt the $2.3bn deal over a long-running dispute linked to the termination of distribution rights dating back to 2016. “The petitioner's notice of motion dated 5th January 2026 is hereby dismissed,” Bahati Mwamuye, a High Court judge, said, as quoted by Reuters , adding that all orders that could have impeded completion of the transaction had been lifted. EABL said it welcomed the ruling and would continue to defend its position in the underlying dispute, while the companies move ahead with plans to finalise the sale in the second half of the year. Diageo agreed in December to sell its 65% stake in EABL as part of a strategy to cut debt and revive performance after a period of weak sales and investor pressure. The company has also been navigating challenges, including tariff uncertainty, shifting consumer preferences and softer global demand for alcoholic beverages. For Asahi, the acquisition forms part of a wider expansion strategy targeting emerging markets in Africa and South America . The Tokyo -headquartered brewer has identified EABL’s regional footprint, brand portfolio and production capacity as key assets. The Kenyan government has backed the deal, viewing it as a signal to foreign investors at a time when authorities are seeking to attract capital into the industrial sector and support job creation. EABL recently reported stronger financial performance, posting a 37.6% rise in profit after tax to KES11.16bn ( $86.49mn ) for the half year ended December 2025 . The company also increased its interim dividend by 60% to KES4 ( $0.03 ) per share, according to disclosures previously reported by IntelliNews . © 2026 bne IntelliNews, source Magazine