Kenya’s competition regulator has approved the sale of Diageo’s 65 per cent stake in East African Breweries Plc (EABL) to Japan’s Asahi Group Holdings, clearing a major hurdle in the $2.3 billion transaction (approximately Sh297.9 billion).
The Competition Authority of Kenya (CAK) has, however, attached conditions to the approval, including requiring EABL to set aside sufficient funds from the transaction proceeds to meet any outstanding liabilities.
The regulator has also directed the brewer to reserve 20 per cent of cooler space in retail outlets for competing beverage brands, a measure aimed at maintaining competition in the market following the change in ownership.
“EABL notes the approval by the Competition Authority of Kenya regarding the proposed transaction between Diageo PLC and Asahi Group Holdings, Ltd,” East African Breweries said in a statement to Reuters.
The approval brings the proposed takeover closer to completion after months of regulatory and legal hurdles in Kenya.
Diageo announced the agreement in December 2025, saying it would sell its entire interest in Diageo Kenya Limited to Asahi. The company holds 65 per cent of EABL, giving Asahi indirect control of the East African brewer once the transaction is completed. The deal also covers Diageo’s 53.68 per cent interest in UDV Kenya. EABL owns the remaining 46.32 per cent of UDV Kenya and retains management control of the spirits business.
Diageo said the transaction would give it estimated net proceeds of $2.3 billion after tax and transaction costs. The company has described the disposal as part of its broader strategy to strengthen its balance sheet and reduce debt. The transaction has faced a number of legal challenges since it was announced.
In April, the High Court dismissed an application by distributor Bia Tosha Distributors Limited seeking to stop the sale, lifting an interim order that had temporarily prevented completion of the transaction.
Bia Tosha had argued that Diageo’s exit could affect its ability to pursue a separate commercial dispute involving EABL and related entities.
EABL later asked Chief Justice Martha Koome to intervene in several court cases surrounding the transaction, arguing that parallel proceedings risked creating uncertainty around one of the region’s largest corporate deals.
In August, CAK had sought a reserve fund of about Sh15.5 billion from EABL before granting approval. The amount was linked to potential liabilities and third-party claims that could arise after completion of the transaction.
The latest approval now removes the competition regulator’s major hurdle, although the transaction remains subject to the completion requirements set by the parties and relevant authorities. For Asahi, the acquisition will give the Japanese beverage group a major foothold in East Africa. The company has said the transaction is intended to build a platform for growth in the region while combining its portfolio with EABL’s established brands and market presence.
