A parliamentary committee wants the competition watchdog to ensure that the proposed acquisition of British multinational Diageo's stake in East African Breweries PLC (EABL) by Japan's Asahi Group Holdings does not undermine market competition or prejudice the interests of local farmers, distributors, employees and consumers.

The Finance and National Planning Committee chaired by Molo MP Kuria Kimani has asked the Competition Authority of Kenya (CAK) to ensure binding safeguards for farmers and competitors in the proposed Diageo-Asahi deal.

Speaking at a meeting with the CAK on the proposed sale, the committee demanded to know whether the transaction has specific safeguards to protect stakeholders following the ownership transition.

“We must ensure that farmers, distributors and employees are not left vulnerable once this transaction is concluded. These protections must be in place before any merger,” Mr Kimani said.

“The transaction must be backed by enforceable contractual commitments.”

Mr Kimani also directed CAK to submit a Kenya-specific valuation of the transaction and documentary evidence of the proposed stakeholder safeguards within seven days.

Diageo and Asahi Holdings agreed the sale of the 65 percent stake in EABL for a consideration of $2.354 billion (Sh304.6 billion) in December 2025.

Asahi also agreed to purchase Diageo’s 53.68 percent holding in spirits producer and importer UDV Kenya for $646 million (Sh83.6 billion), taking the total size of the deal to Sh388.2 billion.

Asahi aims to leverage EABL's strong brand portfolio and production facilities to expand its presence in East Africa while EABL looks to maintain its operations and continue to grow under Asahi's stewardship.

While responding to Mr Kimani’s concerns, CAK director-general David Kemei told MPs that existing contracts with sorghum and millet farmers, distributors, and employees would remain binding and fully honoured, adding that the competition watchdog will continuously monitor compliance with all merger conditions.

“We have proposed a key condition requiring the merged entity to reserve at least 20 percent of shelf space in major retail outlets for competing brands to safeguard fair competition and consumer choice,” Mr Kemei said.

Committee members sought clarification on measures that are in place to prevent smaller beverage manufacturers from being edged out of the retail market.

The committee further sought to know the financial safeguards accompanying the transaction.

Mr Kemei said Asahi and EABL would be required to establish a dedicated financial reserve equivalent to four percent of the total transaction value to cover third-party liabilities and legal claims arising from the sale.

→ emutai@ke.nationmedia.com

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