The planned sale of British multinational Diageo’s Sh303 billion stake in East African Breweries Limited (EABL) to Japan’s Asahi Group Holdings will proceed after the High Court refused to extend interim orders blocking the transaction, clearing a key legal hurdle for one of the largest foreign direct investments in the East African beverage sector. The ruling allows the parties to continue preparatory and regulatory processes toward closing the deal, subject to approvals in Kenya and other regional markets.
On Thursday, February 26 2026, the High Court declined to extend previous conservatory orders that had temporarily frozen the sale after a local firm sought to block the transaction through litigation. The recent interim orders had halted the final transfer of shares while legal challenges were heard, but the court found “no legal or factual basis” to maintain the freeze, effectively letting the deal resume its course.
The legal challenge was initiated by Bia Tosha Distributors, a former Diageo distributor which argued that Diageo’s exit from Kenya by selling its stake in EABL could frustrate its ongoing claims over a long running contractual dispute. The petitioner had sought to prolong the earlier court orders to prevent the share transfer until its claims were resolved. However, advocates for EABL and Diageo contested the extension, saying there was insufficient basis to keep the interim block in place.
Diageo agreed in December 2025 to sell its 65 percent shareholding in EABL, the largest brewer in East Africa, for approximately $2.354 billion (about Sh303 billion) to Asahi Group Holdings. The transaction will also see Asahi take full control of Diageo’s interests in UDV (Kenya) Limited, which handles spirits and ready to drink brands. The sale forms part of Diageo’s broader strategy to divest from direct African beer holdings and strengthen its balance sheet amid shifting global markets.
EABL and its board have maintained that the transaction is a shareholder-level arrangement and does not affect the company’s operations, management or brand portfolios in Kenya, Uganda and Tanzania. Under the terms, EABL is expected to continue producing and distributing existing local and international brands, including iconic products such as Tusker, while Asahi becomes the controlling shareholder upon completion.
The High Court’s decision not to extend legal blocks means that regulatory review processes including approvals from the Competition Authority of Kenya, the Capital Markets Authority, and corresponding authorities in Uganda and Tanzania can proceed without the stay that had previously limited progress. Industry watchers say this is crucial to meeting projected timelines, with closing still anticipated later in 2026 once all clearances are obtained.
In a competitive market where EABL has historically dominated alcoholic beverage sales across East Africa, the transfer of control to Asahi is expected to reshape the regional brewing landscape. The Japanese group has stated it will retain EABL’s local brands and operational footprint, signaling continuity for existing shareholders and employees.
