Kenyan court has postponed a lawsuit to stop Diageo from selling EABL for $2.3 billion
Kenya’s High Court on Friday rescheduled the hearing for January 20 regarding a case aimed at halting Diageo’s $2.3 billion sale of its local subsidiary EABL to Japan’s Asahi Holdings.
Diageo announced last month that it had reached an agreement to sell its 65% stake in East African Breweries Limited to the Japanese brewer. Diageo is divesting non-core assets to decrease debt and mitigate the effects of U.S. tariffs and a decline in sales resulting from changing consumer behaviors.
This week, Bia Tosha, a Kenyan beer distributor, initiated legal action to obstruct the deal due to ongoing litigation from 2016, resulting in a decline in Diageo’s shares. EABL has stated that the case lacks any legal or factual connection to the transaction.
Bahati Mwamuye, a judge at the court, stated that the parties involved in the deal could undertake preliminary actions, such as seeking regulatory approvals, provided that the transaction is not finalized by January 20, when the court will issue further directions.
Deal parties have indicated that they anticipate completion in the latter half of this year. “We welcome the court’s decision to permit the regulatory phases of this transaction to proceed,” EABL stated in a release.
