Firm seeks urgent orders to secure Ksh.3B from Diageo before planned sale of shares

JILK Construction Company Ltd has filed a Notice of Motion against Diageo PLC, Kenya Breweries Ltd (KBL), East African Breweries Ltd (EABL), and the Competition Authority of Kenya (CAK), asking the court to compel the first three respondents to reserve and deposit Ksh.3 billion in court pending the hearing and determination of the suit.

The applicant is also urging the court to fast-track the case and deliver judgment by 30 April 2026, ahead of anticipated regulatory approvals for the sale of Diageo’s stake in EABL to Japan’s Asahi Group Holdings, expected between May and June 2026.

Through lawyer Kibe Mungai, JILK argues that the matter is extremely urgent because Diageo’s planned exit from Kenya could compromise its ability to recover sums claimed in a long-running dispute arising from construction works at the Kisumu brewery plant.

"It is necessary for this court to order the three respondents to deposit the Ksh.3 billion in court in order to stop or prevent further schemes to instruct the court if justice and to abuse court process inures for them to escape the legal obligations to pay the applicant its just claims for compensation," reads court papers.

According to the application, JILK entered into three construction contracts with Kenya Breweries Ltd between October 2017 and March 2018 for civil works related to the refurbishment of the Kisumu brewery under what was known as Project Nafasi. The contracts were executed, and the works handed over, but disputes later arose over payment and project execution.

Although the contracts were formally between JILK and KBL, the firm claims that Diageo PLC exercised full control over the project, including supervision, procurement, and financial decisions, effectively acting as the true client.

JILK says unresolved disputes from the project led it to initiate arbitration proceedings, where it is claiming Ksh.2.45 billion plus interest and costs. Final submissions in the arbitration were filed in August and November 2024, respectively, paving the way for an award.

However, the applicant alleges that delivery of the arbitral award was blocked after KBL filed a constitutional petition in December 2024, resulting in conservatory orders stopping the arbitrator from publishing the award. That petition remains pending.

Beyond the commercial dispute, the application raises grave allegations of sexual harassment and abuse of JILK’s female employees by foreign consultants and officials allegedly associated with Diageo during the project.

JILK claims that senior officials ignored complaints raised internally and later sought to shield those accused from accountability. Two female workers reported alleged sexual harassment to the police in January 2020, prompting investigations by the Directorate of Criminal Investigations.

The firm further alleges that the respondents fabricated a whistleblower report, which it says was used to justify court action that stalled the arbitration process, amounting to an abuse of court process and obstruction of justice.

Central to the urgent application is JILK’s concern that Diageo’s sale of its EABL stake and possible exit from Kenya could place its assets beyond the reach of Kenyan courts.

To avert this risk, JILK is asking the court to order the respondents to deposit Ksh.3 billion in court or otherwise reserve the amount to cater for the anticipated arbitral award, judgment in the suit, and costs.

The firm insists that granting the orders would not prejudice the respondents but would safeguard the integrity of the judicial process and ensure that justice is not defeated by corporate restructuring or asset transfers.

In the substantive suit, JILK is seeking multiple declarations, including findings that the respondents violated the Companies Act, Employment Act, Sexual Offences Act, and several constitutional provisions.

It is also seeking compensation for affected female workers, damages for alleged abuse of court process, and orders compelling the Competition Authority of Kenya to take into account the court’s judgment when reviewing the Diageo Asahi transaction.