High Court clears Diageo’s EABL stake sale to Asahi, dismisses Bia Tosha bid 

KENYA – The High Court of Kenya has dismissed an application by beer distributor Bia Tosha seeking to block the sale of Diageo’s 65% stake in East Africa Breweries Limited (EABL) and its holding in UDV Kenya to Japan’s Asahi Group Holdings. 

The ruling clears a major hurdle for the transaction, which is expected to rank among the largest corporate deals in Kenya. 

“The petitioner’s notice of motion dated 5th January 2026 is hereby dismissed,” said High Court Judge Bahati Mwamuye, adding that any orders that could impede the completion of the deal were lifted. 

Diageo announced in December that it had agreed to sell its stake in EABL as part of a broader strategy to reduce debt and revive growth. The deal is valued at approximately Ksh 300 billion and will see Asahi take full control of Diageo Kenya Limited, the investment vehicle holding the stake in EABL. 

Asahi will also acquire Diageo’s 53.68% shareholding in UDV Kenya, where EABL retains the remaining stake and operational control. Upon completion, Asahi is set to become the largest shareholder in EABL. 

Legal dispute and court arguments 

The transaction faced opposition from Bia Tosha, which filed a petition in January seeking to halt the sale over an ongoing legal dispute dating back to 2016. 

The distributor argued that Diageo’s exit from Kenya would undermine its ability to enforce any future court ruling. It said it could be forced to pursue litigation in the United Kingdom if it succeeds in its claim for damages, which it estimates at Sh25 billion. 

Bia Tosha further contended that transferring the shares would place Diageo beyond the jurisdiction of Kenyan courts, effectively frustrating enforcement of any decree issued in its favour. 

EABL and Diageo opposed the application, warning that blocking the transaction would disrupt a well-established supply chain supporting thousands of jobs across Kenya and the wider East African region.  

They argued that such disruption would affect distributors, retailers, hospitality partners, farmers and other suppliers dependent on stable production and logistics systems. 

Diageo described the application as an attempt to “hoodwink the court” into interfering with a nationally significant transaction in order to advance private commercial interests. 

The dispute originates from a 2000 agreement under which Kenya Breweries Limited (KBL) granted Bia Tosha distribution rights across several areas in Nairobi and Kajiado. The distributor paid Ksh 27.3 million in goodwill for the territories but later sought a refund after some areas were repossessed and reassigned. 

KBL maintained that the payments were non-refundable and that the agreement was non-exclusive. 

The case has been in court since 2016, involving multiple rulings, including a referral to arbitration by the Court of Appeal and a subsequent Supreme Court decision reinstating High Court proceedings. 

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