A Kenyan court on Friday postponed to January 20 a hearing in a case seeking to block British drinks giant Diageo’s planned US$2.3 billion sale of its majority stake in East African Breweries Limited (EABL) to Japan’s Asahi Group Holdings.
Diageo, the maker of Johnnie Walker whisky and Guinness stout, announced last month it had agreed to sell its 65 percent stake in EABL as part of a broader strategy to streamline operations and cut debt.
The case was filed this week by Kenyan beer distributor Bia Tosha, which argues that the transaction should be halted due to unresolved litigation dating back to 2016. The filing briefly weighed on Diageo’s share price earlier this week.
EABL has dismissed the legal challenge, saying it has no factual or legal connection to the proposed sale and should not interfere with the transaction.
The brewer, which dominates beer markets in Kenya, Uganda and Tanzania, produces popular brands including Tusker, Bell Lager and Guinness under licence.
Diageo has been offloading what it describes as non-core assets as it seeks to strengthen its balance sheet, while also contending with weaker demand in some markets, shifting consumer preferences and the impact of U.S. tariffs.
The proposed sale would mark a major expansion for Asahi, which has been steadily growing its global footprint through acquisitions in Europe and emerging markets.
Kenya’s High Court did not give reasons for the adjournment, but the delay prolongs uncertainty around one of the largest corporate transactions in East Africa in recent years.
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EABL’s shares have been closely watched by investors since the deal was announced, with analysts saying the outcome of the court case could influence both the transaction’s timeline and investor confidence in Kenya’s regulatory and legal environment.
