Bia Tosha, a Kenyan beer distribution firm, has filed a case at Kenya’s High Court seeking to block Diageo’s $2.3 billion sale of its local subsidiary East African Breweries Limited (EABL) to Japan’s Asahi Holdings. The move comes amid pending litigation between Bia Tosha and Diageo over a competition dispute.
The High Court has certified the case as urgent, with a hearing scheduled for Friday. Diageo, the world’s largest spirits group, agreed to sell its 65% stake in EABL to Asahi as part of its efforts to reduce debt and offset the impact of US tariffs and shifting consumer patterns.
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EABL, listed on the Nairobi bourse, maintains that the case has no factual or legal links to the transaction and remains capable of conducting its business and defending litigation. “Regardless of the change of majority shareholder, EABL and KBL remain independent, capable entities fully able to conduct their business and defend any litigation,” EABL said in a statement.
Diageo’s decision to sell EABL is part of its broader strategy to sell assets and reduce debt. The company inherited African beer operations when it was formed via the merger of Grand Metropolitan and Guinness in 1997. If the sale is completed, Diageo will no longer have a direct stake in the African beer business.
Shares in Diageo fell more than 2% on news of the case, while EABL was 0.5% lower. Diageo has not commented on the matter.
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