Kenya’s High Court has dismissed JILK Construction’s application to block Diageo’s sale of its East African Breweries stake to Asahi Group, the third legal challenge to fail since January and the strongest signal yet that the deal is heading toward completion.
Justice Gregory Mutai ruled this week that JILK had not shown sufficient grounds to halt the transaction. The contractor neither claimed ownership of the disputed shares nor sought payment from the sale proceeds, the judge found. JILK’s underlying grievance, a KSh2.45 billion arbitral claim tied to refurbishment work at Kenya Breweries’ Kisumu plant, predates the Diageo-Asahi agreement by years and has no demonstrated link to the share transfer.
The ruling matters less for what it says about JILK than for what it confirms about the deal’s trajectory. Bia Tosha Distributors lost two separate attempts to freeze the sale, the most recent in June after the court found the distributor had already sought relief at the Court of Appeal. Beer entrepreneur Peter Gachuru’s challenge was dismissed in May. Activist lawyer Shane Ngechu’s case remains pending.
Justice Mutai leaned explicitly on public-finance interest, citing the roughly KSh42 billion in capital gains tax the deal is expected to generate for Kenya’s exchequer. EABL welcomed the ruling, saying unrelated historical disputes should not be used to delay transactions of major economic significance.
Asahi has already cleared capital markets exemptions in Kenya, Uganda and Tanzania, securing relief from mandatory minority buyout offers while keeping EABL listed across the Nairobi, Dar es Salaam and Uganda exchanges. The single outstanding gate is merger clearance from the Competition Authority of Kenya, which must weigh a transaction handing one buyer roughly 75% of the Kenyan beer market. That review, not the courts, now determines whether completion lands within Diageo’s stated second-half 2026 window.
The contrast with Asahi’s other June move is instructive. Days before this ruling, the Japanese group launched its Calpis fermented milk drink in India through a franchise deal with PepsiCo bottler Varun Beverages, a low-capital, partnership-led entry into a new category. The EABL takeover is the opposite bet: full ownership of an established East African brewer, absorbed whole rather than franchised. Asahi’s next move is the CAK filing; EABL’s board will be watching for any divestment or pricing conditions attached to that approval.
READ MORE
- Kenyan Court Clears Way for Asahi’s $2.3 Billion EABL Takeover
- Asahi Brings Calpis to India Through Varun Beverages as Non-Alcohol Push Begins
- Guinness Nigeria’s Q1 Profit Surge Seals Tolaram’s Turnaround Thesis
