NAIROBI, Kenya, Sept 2 – The High Court has temporarily stopped the completion of the proposed sale of Diageo’s controlling stake in East African Breweries (EABL) to Japan’s Asahi Group Holdings, pending ongoing regulatory and legal processes.
Justice Francis Gikonyo ruled that the ownership and control of EABL as it stood on June 18, 2026 must remain unchanged until an appeal before the Capital Markets Tribunal is determined and the Competition Authority of Kenya (CAK) completes its review of the transaction.
The case was filed by Christine Irungu, who has challenged the transaction, raising concerns over disclosure of information, protection of minority shareholders and the role played by market regulators.
A key issue is Diageo’s decision to increase its stake in EABL from about 50 percent to approximately 65 percent through a 2022-2023 tender offer before agreeing to sell its controlling interest to Asahi.
Irungu has questioned whether the earlier share purchase increased Diageo’s controlling stake ahead of the eventual sale and whether minority shareholders were given adequate information.
“The petition raises constitutional issues including violation of specified constitutional provisions, rights and guarantees as well as exercise of mandates by statutory authorities concerned.”
Diageo, EABL and Asahi opposed the application, arguing that the issues raised should primarily be handled through the specialized regulatory bodies and tribunals established under Kenya’s capital markets and competition laws.
They also argued that stopping the transaction could hurt investor confidence and Kenya’s attractiveness as an investment destination.
CAK separately argued that the High Court should not hear the case before the available regulatory appeal mechanisms are exhausted.
The High Court, however, found that the dispute involves several institutions and raises broader constitutional questions that cannot be dealt with fully by a single regulatory body.
The court also noted that CAK is still reviewing the transaction and has not yet issued a decision that could be challenged before the Competition Tribunal.
At the same time, the Capital Markets Tribunal is dealing with an appeal by EABL minority shareholders against the CMA’s decision to exempt Asahi from making a mandatory takeover offer.
Justice Gikonyo said allowing the transaction to proceed before these processes are completed could undermine the ongoing proceedings.
“An order of status quo will allow the appeal to be concluded as well as Competition Authority to determine the matters before it.”
