Heineken to pay Maxam Limited US$13.1M after Supreme Court loss 

KENYA – The Supreme Court of Kenya has dismissed an appeal by Dutch brewing giant Heineken, denying the company’s bid to suspend a KES1.79 billion (US$13.1 million) award to Maxam Limited. 

The ruling, delivered by a five-judge bench led by Chief Justice Martha Koome, marks a significant loss for Heineken, following earlier rulings by the Court of Appeal and the High Court in favor of Maxam, , a beverage distributor owned by Kenyan businessman Ngugi Kiuna.. 

The case revolves around Heineken’s termination of its distributorship agreement with Maxam, a move that both lower courts had deemed unlawful.  

Heineken had sought to contest these judgments, appealing to the Supreme Court to overturn the decision. However, the Supreme Court ruled that the case did not raise constitutional matters, which were key to Heineken’s argument. 

Chief Justice Koome, along with Deputy Chief Justice Philomena Mwilu and Justices Mohammed Ibrahim, Smokin Wanjala, and Njoki Ndung’u, stated that the dispute was fundamentally a contractual issue, not a matter of constitutional interpretation.  

The court found that the primary focus of the case was the legitimacy of Heineken’s termination notice to Maxam. 

“The distribution agreement’s validity was central to the orders sought,” the judges noted, reaffirming that both the High Court and the Court of Appeal had based their rulings on the legality of the termination, not constitutional concerns. 

Heineken had argued that the distributorship agreement contained a clause exempting the company from compensating losses related to termination and required mutual agreement between the two parties for separation. The company claimed Maxam acted unilaterally, violating this clause. 

Heineken East Africa’s director, Kevin Santry, raised concerns about the financial impact of the judgment, warning that the Ksh1.79 billion bank guarantee held by Equity Bank could be called.  

Heineken’s senior counsel, Fred Ngatia, also cautioned that recovering the funds, once paid, could become legally complicated. 

Maxam Limited, founded in 2006, played a key role in expanding Heineken’s market presence in Kenya, Tanzania, and Uganda. The partnership was instrumental in helping the Dutch brewer establish itself in East Africa. 

Meanwhile, Heineken has declined to comment on reports suggesting it has reached an agreement to acquire Ethiopia-based Komari Beverage. 

The speculation, first reported by The Capital, suggests a deal was recently finalized and will be officially announced within the next few weeks.  

According to the report, unnamed sources confirmed that the deal had been concluded last week, although no official statement has been made by either party. 

Sign up to receive our email newsletters with the latest news updates and insights from Africa and the World HERE