Category: Business

THE DEAL AT A GLANCE

 Transaction: Diageo PLC sells 65% EABL stake + 53.68% UDV (Kenya) to Asahi Group Holdings

 Value: Sh303.5 billion ($2.354 billion) at Sh590.51 per share

 Status: Regulatory approvals pending in Kenya, Uganda, and Tanzania — expected May-June 2026

 Petitioner: Bia Tosha Distributors Limited — distributor dispute dating to 2000

 Latest development: High Court dismissal April 9, 2026; Court of Appeal notice filed April 10, 2026

It was the ruling that was supposed to end it all. On the morning of Thursday, April 9, 2026, Justice Bahati Mwamuye of the High Court’s Constitutional and Human Rights Division delivered what Diageo, EABL, and their legal teams had been arguing for three months was the only legally defensible outcome: a clean dismissal of Bia Tosha Distributors Limited’s petition to block the Sh303 billion sale of Diageo’s majority EABL stake to Japan’s Asahi Group Holdings. ‘The petitioner’s notice of motion dated 5th January 2026 is hereby dismissed,’ the judge declared, lifting all interim orders that had restrained the finalisation of the transaction.

EABL issued a statement welcoming the ruling and noting that the deal could now proceed through standard regulatory channels. Diageo’s camp exhaled. Asahi’s representatives, watching from Tokyo, had cause for quiet satisfaction. The deal they had committed $2.354 billion to — one of the largest investments a Japanese company has ever made in Africa — appeared, finally, to be free of its most persistent legal obstruction.

It lasted twenty-four hours.

By Friday morning, April 10, Bia Tosha had filed a notice of appeal against the ruling in its entirety. The notice, addressed to the Court of Appeal, stated that the company was ‘dissatisfied with the ruling and orders of the Honourable Mr. Justice Bahati Mwamuye, delivered on the 9th day of April 2026,’ and that it intended to challenge the whole of that ruling. In a tactical escalation that will unsettle the deal’s timeline, Bia Tosha also announced it was enjoining two regulatory bodies — the Capital Markets Authority and the Competition Authority of Kenya — as additional respondents in the appeal.

Both agencies are currently processing approvals that Diageo and Asahi need to complete the transaction. By pulling them into court proceedings, Bia Tosha has raised the possibility that approvals expected between May and June 2026 could become contested on grounds that go beyond the transaction’s commercial merits.

“The sale will render its case useless as splitting the shares and the exit of Diageo from the Kenyan market would have the effect of frustrating the realisation of any decree.” — Bia Tosha court filings

THE MWAMUYE PARADOX

There is a biographical irony in Justice Mwamuye being the judge who ultimately dismissed the case. Weeks earlier, it was his transfer to Kiambu High Court on February 26 — announced on the day the substantive hearing was due — that triggered the most explosive chapter of this dispute.

Bia Tosha interpreted that transfer, and his refusal to extend interim orders on that same day, as the pivotal moment that stripped them of constitutional protection and handed the deal a green light.

Managing Director Anne-Marie Burugu wrote directly to Chief Justice Martha Koome, deploying language that compared the alleged dynamics to the Epstein-Prince Andrew affair and accusing unnamed foreign actors of diplomatic intervention in Kenya’s judiciary.

Yet on April 9, when the case came before the court in Milimani as originally directed, it was Justice Mwamuye himself who sat in judgment. Whatever the circumstances of his February transfer — Judiciary officials described it as routine administrative redeployment — he returned to the matter for its final hearing.

His ruling was categorical. The court found that the issues Bia Tosha raised were contractual in nature, that the existence of a commercial dispute between private parties does not automatically justify suspension of a major corporate deal, and that appropriate legal remedies remain available to the distributor should it succeed in the underlying claim. Any other orders impeding completion were simultaneously lifted.

The ruling was precise in its separation of two things Bia Tosha has consistently attempted to conflate: the legitimacy of the underlying distributorship dispute, which the court did not dismiss or invalidate, and the appropriateness of using that dispute as a lever to halt an upstream shareholder transaction. On that second question, Justice Mwamuye sided decisively with Diageo and EABL.

WHAT THE APPEAL ACTUALLY CHANGES

The filing of an appeal notice does not automatically freeze the deal. Under Kenyan procedural law, Bia Tosha would need to separately apply to the Court of Appeal for a stay of the High Court ruling and for fresh conservatory orders if it wants to halt the transaction pending the appeal.

Given that the High Court has just declined to issue such orders after a full hearing, obtaining a stay from the appellate court will require demonstrating that the High Court made a clear error of law, or that there is a novel legal question that the Court of Appeal should consider before the deal closes.

Bia Tosha’s strategic decision to join the CMA and the CAK as respondents in the appeal adds a new dimension.

The implication is that these bodies, in processing and potentially granting regulatory approvals for the transaction while litigation is pending, may be enabling a process that the distributor contends should be paused.

Whether the Court of Appeal finds merit in that framing will depend on how it characterises the relationship between regulatory review processes and pending commercial litigation — a question that Kenyan courts have not definitively answered in a transaction of this scale.

The deal’s parties have expressed confidence that completion will occur in the second half of 2026. That timeline was built on an assumption of regulatory approvals arriving between May and June.

If the Court of Appeal is persuaded to issue any form of stay — even a partial one targeting the regulatory bodies — that timeline shifts. KBL, in opposing the original petition, argued that Kenya’s attractiveness as an investment destination depends on the security and predictability of property rights and the ability of companies to engage in legitimate commercial transactions without what it called unwarranted judicial interference.

That argument cuts both ways: the same predictability norm would counsel the Court of Appeal to be cautious about reopening a question that a full High Court hearing has just resolved.

THE SH25 BILLION CLAIM AND WHY IT MATTERS

A figure that emerged with greater clarity in the April proceedings is the quantum of Bia Tosha’s damages claim: Sh25 billion. This is distinct from the Sh38 million goodwill refund that anchors the original contractual dispute, and from the Sh39 billion contempt fine that Bia Tosha once sought at the Supreme Court.

The Sh25 billion figure represents the company’s assessment of the total commercial loss it has suffered from the termination of its distribution routes across the 22 territories granted to it under the 2000 agreement — a decade of lost revenues, compounded by years of litigation costs and business attrition.

This number matters for the appeal in a specific way. One of Bia Tosha’s core arguments has always been that enforcing a Sh25 billion judgment against a UK-headquartered multinational with no remaining Kenyan assets is materially different from enforcing the same judgment against one that holds a controlling stake in East Africa’s dominant brewer.

Diageo’s general counsel, Anthony David William Smith, swore in an affidavit that the company’s $48 billion market capitalisation and continued submission to Kenyan jurisdiction made enforcement concerns illusory.

But as Bia Tosha’s advocate Kenneth Kiplagat noted to Bloomberg in January, Diageo will have no known asset within Kenya after the sale is complete.

Those are two legally distinct positions, and the Court of Appeal may be asked to assess which characterisation of the enforcement risk is more legally credible.

THE REGULATORY GAMBIT: CMA AND CAK IN THE CROSSHAIRS

The decision to join the CMA and the CAK as respondents is the most tactically aggressive element of the notice of appeal. It signals that Bia Tosha’s next legal objective is not merely to argue for a reversal of the High Court ruling on its merits — it is to insert the court into the regulatory approval process itself.

The CMA, under the Capital Markets Act, is required to approve any change of control of a publicly listed company’s parent. EABL is listed on the Nairobi Securities Exchange.

Diageo Kenya Limited, the vehicle through which Diageo holds its 65 percent stake, will be transferring that vehicle to Asahi. The CMA’s review of this transaction is a statutory process. Similarly, the CAK reviews mergers above a prescribed threshold for competition law compliance.

By arguing before the Court of Appeal that these approvals should not be granted — or should be conditioned on resolution of the Bia Tosha dispute — the company is attempting to weaponise the regulatory process against the deal’s closure timeline.

Whether any Kenyan court would direct a statutory regulator to hold approvals pending resolution of a private commercial dispute is an open question.

The argument has no direct precedent. But the Court of Appeal has, in previous high-profile cases, issued orders with sweeping practical effect on regulatory processes — and the distributorship dispute, unlike most commercial cases, carries a Supreme Court contempt finding against EABL that gives Bia Tosha a stronger than usual platform from which to argue that it is not an ordinary commercial claimant.

“The application is collateral to the pleadings, disproportionate to any pleaded right, and seeks orders whose practical effect would bind non-parties and disrupt capital markets processes in multiple jurisdictions.” — Diageo court submission

DIAGEO’S EXIT AND THE PRESSURE BEHIND IT

To understand the urgency driving both sides, it is necessary to appreciate what is at stake for Diageo beyond this single transaction.

The company’s new CEO Dave Lewis has staked his strategic credibility on a programme of asset disposals and debt reduction. EABL was one of the crown jewels of Diageo’s African portfolio, but it was also a complexity — a partly-listed, multi-jurisdiction operating group in markets that simultaneously delivered strong returns and persistent regulatory, legal, and reputational friction. The $2.354 billion Asahi deal was designed to address all of that in a single transaction.

Diageo is navigating headwinds on multiple fronts simultaneously.

US tariff uncertainty has rattled its North American business. Global alcohol consumption trends among younger consumers are unfavourable. Debt levels, elevated by years of acquisitions, need addressing.

The company cannot afford protracted legal entanglement in Nairobi to delay net proceeds of approximately $2.3 billion that it has already factored into its balance sheet improvement projections. Every month of delay costs Diageo in financing charges, management bandwidth, and investor confidence.

Asahi, for its part, has been clear-eyed about what it is buying.

Its CEO Atsushi Katsuki, meeting EABL staff shortly after the December announcement, described the company as offering an attractive portfolio of brands, marketing capabilities, and production facilities across one of the world’s fastest-growing consumer markets.

For Asahi, the litigation cloud is a price of entry — but an unacceptable delay to entry is a different proposition entirely.

WHAT COMES NEXT

The immediate procedural clock is as follows.

Bia Tosha must file its memorandum of appeal with the Court of Appeal and, if it seeks to pause the transaction, apply separately for a stay of the High Court ruling.

The Court of Appeal will determine whether to grant that stay on an urgent basis, balancing the distributor’s claimed irreversible prejudice against the deal parties’ commercial interests and the public interest argument that a Sh303 billion investment attracting one of Japan’s largest companies into East Africa should not be held hostage to private litigation.

Regulatory approvals at the CMA and CAK are expected between May and June 2026.

If the Court of Appeal grants a stay or issues any order touching the regulatory bodies before those approvals are issued, the timeline shifts materially.

If it declines, the transaction proceeds toward completion in the second half of the year as projected, and the underlying distributorship dispute — which remains very much alive before the High Court — continues in its separate track, now with Diageo on the other side of the world.

That is the precise outcome Bia Tosha has fought to prevent for four months and, in different forms, for ten years.

The Supreme Court found EABL in contempt.

The High Court confirmed EABL’s competing distributors were wrongly appointed on Bia Tosha’s protected routes. The underlying constitutional petition has not been dismissed and will proceed to full hearing.

What Bia Tosha cannot allow — and what it is now taking to the Court of Appeal to resist — is the scenario in which all of that happens after Diageo has collected its $2.354 billion and boarded its flight out of Nairobi.

Whether the Court of Appeal agrees that this scenario represents the kind of irreversible harm that justifies halting one of Kenya’s largest-ever corporate transactions is a question that will be answered in the coming weeks. The case that refuses to die has found its next arena.

A company linked to the family of the late Former Prime Minister Raila Odinga has emerged among beneficiaries of Kenya’s government-to-government (G-to-G) fuel import arrangement, raising fresh questions over the structure of the multi-billion shilling supply programme.

BE Energy, in which the Odinga family holds a 35 per cent stake, is among oil marketers that have recently imported petroleum products under the deal between the government and three Gulf-based suppliers- Saudi Aramco, Abu Dhabi National Oil Company and Emirates National Oil Company.

Under the arrangement introduced in March 2023, Kenya moved away from an open trader system to a framework where selected local firms source fuel from the Gulf companies on a 180-day credit plan before distributing it to downstream retailers.

Industry data shows that BE Energy secured contracts to import two diesel cargoes totalling 85,000 tonnes in the March-April cycle. Other allocations included One Petroleum with 115,000 tonnes, while Gulf Energy handled the bulk of shipments amounting to 723,000 tonnes covering diesel, jet fuel and petrol.

A shipment schedule indicates that BE Energy’s consignments were planned for delivery between March 18 and April 3 in two separate cargoes sourced from Saudi Aramco.

“Cargo delivered in 2 (two) shipments, first parcel delivered ahead of the date range. Supplier has advised that the cargo will be delivered jointly with part KG06A/2026 (vessel ID). Balance shall be delivered ex vessel MT Redan, loading dates and port to be advised,” said the documents.

The G-to-G deal allows Kenya to defer payment for fuel imports for up to six months, easing pressure on foreign exchange reserves by reducing the need for immediate monthly payments estimated at about $500 million. The government has defended the arrangement, citing improved credit terms and renegotiated supplier margins.

BE Energy’s inclusion in the supply chain follows a period of shifting political dynamics, including a cooperation agreement between President William Ruto and the late Raila Odinga in 2025. The firm has also steadily expanded its footprint in Kenya’s petroleum market, increasing its share from 2.4 per cent to over 3 per cent in recent years.

Regulatory data places BE Energy among the country’s top oil marketers, behind major multinational players such as Vivo Energy (Shell), Rubis Energy and TotalEnergies.

Beyond Kenya, the company exports petroleum products to regional markets including Uganda, Rwanda, Burundi, South Sudan and the Democratic Republic of Congo.

Ownership records show that the Odinga family’s stake is held through Pan African Petroleum Company Ltd, alongside majority shareholders linked to a Saudi Arabian investor.

The development comes amid heightened scrutiny of the G-to-G fuel framework, with critics raising concerns over transparency and the concentration of over transparency and the concentration of supply opportunities among a limited pool of firms.

NAIROBI, April 2, 2026 — Domestic carrier 748 Air Services has announced the return of its scheduled passenger operations under the brand Fly 748.com, signaling a renewed push into Kenya’s increasingly competitive local aviation market.

The airline said it will resume flights in May, reconnecting Jomo Kenyatta International Airport with coastal destinations including Mombasa and Ukunda, with introductory fares starting at Sh6,500 one way. The pricing places the airline squarely in the budget-to-mid-tier segment as it seeks to attract both leisure travellers and business commuters.

The relaunch follows a period of operational restructuring, with the company indicating it has overhauled its service delivery, safety systems and overall passenger experience. The move comes at a time when domestic air travel demand is steadily recovering, driven by tourism and increased intercity business movement.

Fly 748.com head George Oduor said the airline’s return represents a strategic effort to restore reliable connectivity on key domestic routes while tapping into underserved markets.

Flights will be operated using Dash 8-Q400 aircraft, known for their efficiency on short-haul routes and suitability for regional airports.

The airline also confirmed it has secured regulatory clearance from the Kenya Civil Aviation Authority ahead of the restart. It further pointed to its BARS Gold Status certification from the Flight Safety Foundation as part of efforts to reassure passengers on safety standards.

Industry observers say the airline’s re-entry could shake up pricing and service dynamics in the domestic aviation space, where competition has been tightening amid rising demand.

In addition to operations, the carrier says it is advancing environmental measures introduced in recent years to cut emissions and improve sustainability, though the extent of these gains remains to be independently verified.

Bookings will be available through the airline’s website, travel agents and ticketing offices, as Fly 748.com positions itself for a comeback in a market where affordability, reliability and safety are expected to determine success.

There is a script that Kenya’s top-tier lenders have rehearsed for decades. Extend credit. Secure it with assets, debentures, and personal guarantees.

Wait.

And when the borrower stumbles, invoke the Insolvency Act with all the force of a sledgehammer. The script, however, appears to have hit a wall in the most expensive and embarrassing fashion possible for NCBA Bank Kenya PLC.

The wall is a Sh88 billion arbitration claim filed before the London Court of International Arbitration, brought by the shareholders of Multiple Hauliers (EA) Limited, a logistics company that NCBA and its co-financier helped fund in 2017 and, the shareholders now allege, helped destroy.

This is not a dispute about a rogue borrower who disappeared into the night with loan proceeds. It is, according to court papers, a claim that the bank and its co-lender Barak Fund SPC Limited, a Mauritius-registered offshore private credit vehicle, agreed to a syndicated facility to fund Multiple Hauliers’ fleet expansion and then failed to disburse the full agreed amount.

That alleged shortfall, the claimants say, set off a liquidity cascade that pushed one of Kenya’s most storied road freight companies into financial ruin and eventual administration. The Sh88 billion claim, which dwarfs the Sh12.7 billion that NCBA says is owed to it, covers alleged lost business, disrupted contracts, and commercial damages stretching across nearly a decade of financial attrition.

If the numbers alone do not concentrate the mind, the timing should. NCBA Group is on the cusp of the most consequential ownership transition in its history. South Africa’s Nedbank has made a formal offer to acquire approximately 66 percent of NCBA for roughly Sh113.7 billion, structured as 20 percent cash and 80 percent newly issued Nedbank shares listed on the Johannesburg Stock Exchange. Kenya’s Capital Markets Authority cleared the deal’s regulatory path in February 2026, granting Nedbank an exemption from mandatory full-offer obligations. Shareholders holding 77.54 percent of NCBA’s equity have committed irrevocable undertakings in support of the transaction, which is expected to close in the third quarter of 2026. The deal, in other words, is all but done. Against that backdrop, an Sh88 billion liability at the London Court of International Arbitration, scheduled for hearing in March 2027, is precisely the kind of disclosure that investors, both existing and incoming, may wish they had seen on the front page of every financial publication in East Africa.

The Anatomy of a Collapsed Financing Deal

The genesis of the dispute lies in a 2017 syndicated financing package that court papers describe as a combination of term loans and working capital lines from NIC Bank (which would later merge with CBA to become NCBA in 2019) and Barak Fund SPC Limited. The facility was secured by debentures over Multiple Hauliers’ assets and by personal and corporate guarantees from the company’s shareholders, principally MG Holdings Limited and individuals including Rajinder Singh Baryan, the Estate of Tarlochan Singh Heer, and Manvir Singh Baryan. The purpose was straightforward: fleet expansion and operational financing for one of Kenya’s oldest and largest road freight operators.

Court papers indicate that Multiple Hauliers attempted to borrow Sh10.8 billion from a consortium of banks in 2017, including NIC Bank. The original consortium also included South Africa’s Standard Bank and its Kenyan subsidiary Stanbic Bank, a detail with a certain irony given that Stanbic is now the vehicle through which Standard Bank had earlier been eyeing NCBA itself. The web of institutional relationships in this case is not incidental. It is constitutive of the problem.

The shareholders allege that the agreed facilities were never fully disbursed. Their claim, filed in London arbitration in 2024, asserts a breach of the financing commitments by both NCBA and Barak Fund. They say the funding shortfall did not merely inconvenience Multiple Hauliers. It strangled it. A logistics company that relies on fleet expansion financing must either expand or contract. The alleged failure to release agreed credit at the critical moment, they say, triggered the liquidity crisis that began the company’s long, painful descent. That descent lasted years. NCBA demanded immediate payment on March 19, 2021, upon the expiry of a standstill agreement that the bank and other participating lenders had signed in March 2020, agreeing to suspend enforcement action for a period of six months.

The timing is worth examining. The standstill agreement, signed in March 2020, coincided with the onset of the COVID-19 pandemic. Multiple Hauliers was already in financial distress, having seen its business eroded in part by the Kenya government’s decision to shift cargo onto the Standard Gauge Railway’s commercial freight service. Logistics firms like Multiple Hauliers had registered significantly lower revenues since 2019 when the government launched the cargo wing of its Standard Gauge Railway business. The combination of a credit shortfall allegedly caused by the lenders, pandemic-era revenue collapse, and SGR competition created a perfect storm in which, the shareholders argue, the bank’s conduct was not merely a contributing factor but the precipitating cause of the company’s ruin.

The firm’s failed bid to borrow Sh14.8 billion in 2017 left it unable to pay many of its debts, which spiralled into two insolvency petitions. By the time the dust settled on the immediate legal skirmishing, Multiple Hauliers was in administration, its fleet depreciating, its employees facing NSSF arrears, and its creditors, which numbered over fifteen institutions, jostling for position in an increasingly chaotic insolvency queue.

The Administration Gambit: Enforcement as Strategy

What makes the Multiple Hauliers case particularly illuminating as a study of NCBA’s enforcement playbook is the sequence of moves the bank made after the standstill agreement expired. Within months of the standstill lapsing, NCBA Bank placed Multiple Hauliers under administration on June 7, 2021, appointing Ernst & Young managers Anthony Makenzi Muthusi and Julius Mumo Ngonga to take over Multiple Hauliers’ affairs. The company fought back immediately. Two days later, Multiple Hauliers opposed the administrators and obtained court orders suspending the administration bid, filing an application seeking the revocation of the appointment of the administrators and a permanent injunction restraining them from advertising their appointment.

The bank’s use of administration as an enforcement tool, rather than as a genuine rescue mechanism, is the core accusation that runs through the years of litigation that followed. The shareholders have consistently argued that NCBA’s objective was never the rehabilitation of Multiple Hauliers but the seizure of its assets at a moment when the company was most vulnerable. The bank’s own court papers lend some texture to this reading. In an affidavit sworn on behalf of NCBA, the bank stated that the proposed investor deal was a ruse that had been used by the company to continue delaying the completion of the administration of the company, and it set out a litany of extensions sought by the company to negotiate from October 2021 to June 2024. The bank, in other words, had grown impatient with a restructuring process that had dragged on for years while its security eroded.

This is precisely the argument that borrowers in distress most fear from lenders of NCBA’s scale and legal resources. The bank’s position, reduced to its essentials, was: we are a secured creditor, our security is deteriorating, and we will use every statutory tool available to protect our exposure. There is nothing unlawful about that position on its face. The problem is what happens when a lender invokes those tools while simultaneously being the subject of an arbitration claim alleging that it caused the distress it is now seeking to resolve through enforcement.

The High Court in October 2025 found that NCBA’s enforcement actions during the pendency of the London arbitration constituted a sufficient risk to the arbitral process to warrant a restraining order. The court barred the bank from appointing administrators or enforcing personal guarantees, warning that such steps could undermine the arbitral process and potentially destroy the company before liability was determined. The Court of Appeal subsequently suspended that restraint on the grounds that the bank’s assets were at risk of dissipation under the company’s current management, but the appellate court was careful to note that it was not resolving the underlying dispute. It directed that the appeal be heard on a priority basis and acknowledged that the substantive legal questions, including the critical question of whether a secured lender can use insolvency tools to override arbitration protections, remain fully live.

NCBA’s Asset Finance Footprint: Power Built on Enforcement

To understand why the Multiple Hauliers case is so significant, one must understand the scale and structure of NCBA’s asset financing operation. The bank has built one of Kenya’s largest asset-backed lending portfolios and markets its corporate asset financing as a defining competitive strength. Its own promotional materials describe the product as providing fleet financing, machinery and equipment loans, and operating leases with approval processes that can be completed in a single day. NCBA held vehicles valued at Sh56 billion as collateral from borrowers, while it held broader property security of Sh334 billion, representing 67 percent of its total Sh498 billion in security.

The numbers make clear that asset enforcement is not a peripheral activity for this bank. It is a central pillar of its credit risk management. When a borrower defaults, the bank’s ability to repossess vehicles, machinery, and property and sell them under the statutory power of sale is the mechanism through which its capital ratios are protected. Kenya’s courts have generally been sympathetic to this position. In case after case, judges have upheld the bank’s right to repossess assets and exercise the statutory power of sale, even when borrowers raised questions about the accuracy of outstanding balances.

In Aggarwal v NCBA Bank Kenya PLC, a case decided by the High Court in April 2024, a borrower who had paid over Sh87 million toward settlement of an outstanding facility and offered two properties in full and final settlement found himself facing auction proceedings when the bank resumed enforcement. The court noted that the loan had stood at Sh195,023,495 plus a dollar-denominated portion as at October 2023, and that NCBA had argued that the statutory notices had been properly served, satisfying the requirements for the exercise of the power of sale. The borrower lost.

In Ndungu v NCBA Bank Kenya PLC, decided in March 2025, a borrower complained that the bank had unilaterally changed the conversion rate on a dollar-denominated loan when her salary currency changed, resulting in a higher outstanding balance than she expected. The bank proceeded to recover Sh759,461.95 directly from the plaintiff’s bank account in January and February 2024, which caused her to move her salary account to another bank to stop what she described as the bank raiding her finances, and the bank then threatened to report her to the Credit Reference Bureau. The court declined to grant an injunction, ruling that the value of the mortgaged property could be quantified and that any improper exercise of the power of sale could be compensated in damages. The borrower’s house remained at risk of auction.

In NCBA Bank v Nyaata, a 2024 case at the High Court, a borrower raised the argument that NCBA had repossessed an asset during the pendency of a consent agreement on loan restructuring. The borrower stated that the bank’s action of instructing a repossession agent to repossess the subject motor vehicle during the pendency of the parties’ consent agreement on restructuring of the loan was ill-intended, and the borrower further alleged that an overpayment had been made on the loan facility. The pattern across these cases is remarkably consistent: a distressed borrower challenges the bank’s enforcement, raises questions about the accuracy of its accounts or the terms of its agreements, and finds the courts largely unmoved.

The Multiple Hauliers case represents the mirror image of this pattern. For once, the borrower’s shareholders did not wait for NCBA to foreclose and then challenge in a Kenyan court where the institutional weight of a Tier One lender looms large. They took the fight to London, before an international tribunal where the playing field is genuinely level and where a Sh88 billion damages claim demands the same forensic scrutiny as any other commercial dispute, regardless of which party holds the debentures.

The Ownership Transition: What Nedbank Is Buying Into

The Multiple Hauliers arbitration does not exist in isolation from NCBA’s ownership story. That story has grown considerably more complicated in recent years. NCBA Group is primarily owned by the family of former Central Bank of Kenya Governor Philip Ndegwa, which, as of December 2024, had overtaken the Kenyatta family to become the largest shareholder. Through First Chartered Securities, the Ndegwa family holds a 14.44 percent stake in NCBA Group, amounting to Sh8 billion, after acquiring an additional 31.6 million shares. The Kenyatta family, through Enke Investments, retains a 13.2 percent stake, while D&M Management Services holds 11.54 percent. In December 2025, Muhoho Kenyatta, the son of the late President Jomo Kenyatta and brother of former President Uhuru Kenyatta, was appointed a Non-Executive Director, formalising the family’s renewed board presence at a bank they have been associated with since CBA’s era.

The Nedbank transaction adds a further layer. Nedbank Group has secured a Kenyan regulatory waiver from the Capital Markets Authority that clears the way for its plan to acquire about 66 percent of NCBA Group, with the exemption granted on February 19, 2026, relieving the South African lender from the requirement to make a mandatory offer for 100 percent of NCBA shares. The transaction, expected to close in the third quarter of 2026, would make NCBA a subsidiary of the South African lender while the remaining 34 percent of its shares continue to trade on the Nairobi Securities Exchange. Shareholders holding 77.54 percent of NCBA’s equity have committed irrevocable undertakings in support of the offer.

Nedbank is not acquiring a blank slate. It is acquiring a bank that is the principal defendant in an Sh88 billion international arbitration, a bank with Sh56 billion in vehicle collateral and Sh334 billion in property security that it has shown itself willing and able to enforce with speed and aggression, and a bank whose asset financing portfolio has generated a paper trail of borrower grievances stretching from individual vehicle repossessions to the near-liquidation of one of Kenya’s oldest transport companies. Whether the South African lender has conducted due diligence on the full scope of that liability, and whether the arbitration claim is disclosed in the transaction documents with the prominence it deserves, are questions that minority shareholders left behind on the Nairobi Securities Exchange may wish to press at the next annual general meeting.

What Every Borrower Should Know

The Multiple Hauliers case offers lessons that extend far beyond the transport sector. They speak directly to any business that has entered, or is considering entering, a large asset-backed or syndicated financing arrangement with NCBA or any comparably aggressive lender.

The first lesson is that a standstill agreement is not a ceasefire. NCBA and the other participating lenders signed a standstill deal in March 2020 agreeing to suspend enforcement action for six months, and then NCBA demanded immediate payment in March 2021 upon its expiry, and moved to appoint administrators within months. A standstill buys time. It does not change the fundamental dynamic of power between a secured lender and a distressed borrower.

The second lesson is that the bank’s internal documentation and account statements should be subject to independent verification at every stage of a large loan relationship. The Ndungu case, the Aggarwal case, and the Nyaata case all share a common feature: borrowers who disputed the accuracy of the bank’s outstanding balance calculations and found those disputes treated as legally insufficient to restrain enforcement. In the Multiple Hauliers dispute, the shareholders take that grievance to its logical extreme: they allege not just that the bank miscalculated what was owed, but that the bank never disbursed what was agreed, and that the entire subsequent debt edifice rests on a foundation of alleged breach.

The third lesson is structural. NCBA’s general terms and conditions, as revealed in Mbogo v NCBA Bank Kenya, contain a clause permitting the bank to terminate or vary its business relationship with the customer at any time upon notice, and to freeze any account without prior notice in a wide range of circumstances including, remarkably, circumstances where the bank has doubt for any reason, whether or not well founded, as to the person or persons entitled to operate the account. The General Terms and Conditions of NCBA Bank provide that the bank may at any time, upon notice to the customer, cancel credits which it has granted and require the repayment of outstanding debts resulting therefrom within such time as the bank may determine. That contractual asymmetry, standard across Kenyan banking but rarely examined in isolation, means that the bank retains near-unlimited discretion to alter the terms of engagement in its favour, subject only to the limits imposed by statute and case law.

The fourth lesson is jurisdictional. The Multiple Hauliers shareholders’ decision to file their claim in London rather than Nairobi was not merely a tactical choice. It was a recognition that Kenyan courts, while increasingly sophisticated in commercial matters, operate within a context where institutional lenders carry structural advantages: deeper legal resources, greater familiarity with insolvency procedures, and an implicit presumption, visible in judgment after judgment, that secured creditors have rights that borrowers in default cannot easily override. The London Court of International Arbitration does not carry those assumptions. Before it, NCBA must answer the shareholders’ claim on its merits, with no home advantage.

Conclusion: The Trial of a Business Model

NCBA is not a rogue institution. It is a properly regulated, NSE-listed bank that has generated consistent profits for its shareholders, including two of Kenya’s most powerful business dynasties, and that is about to become a subsidiary of one of Southern Africa’s largest lenders. But the Multiple Hauliers case is a stress test of whether the bank’s asset financing model, built on aggressive security enforcement and the liberal use of insolvency tools, can withstand scrutiny before a forum that it cannot home-court.

The arbitration hearing is fourteen months away. The Sh88 billion claim is not going anywhere. If the shareholders’ version of events withstands the scrutiny of an international tribunal, the implications for NCBA’s commercial reputation in the transport and logistics sector, and for the confidence of large syndicated borrowers more generally, will be severe. Every corporate borrower who has signed a syndicated loan agreement with NCBA, every business that has pledged its assets as security for a working capital facility, and every investor who is considering buying into the bank through the Nedbank transaction should read the particulars of this case with the attention it demands.

The London arbitration is, in essence, the bill coming due for a model of lending that extracts maximum security, enforces it at maximum speed, and bets that the Kenyan courts will always see the matter from the lender’s side. The bet may be about to be tested before judges who have no interest in that outcome.

The London Court of International Arbitration hearing in the Multiple Hauliers matter is scheduled for March 2027. Kenya Insights will continue to report on developments in this matter.

Kenyans woke up last weekend poorer. Not because of a robbery, a failed business, or an economic shock. Poorer because their telecommunications provider, Safaricom PLC, had quietly reached into their M-Pesa wallets and extracted money for alleged Fuliza debts, some of which the affected customers insist they never incurred. By Monday morning, a single lawyer’s post on X had torn open a wound that goes far deeper than a billing glitch.

Eric Muriuki, founding partner of MKA Law, is not easily rattled. But he was rattled. He published a screenshot of his exchange with Safaricom Care in which the company admitted it had, as a result of what it described as a “system issue,” failed to bill him accurately for Fuliza taken between February 26, 2026, and March 20, 2026. The “correction” came in the form of a KSh 60 deduction from his account without forewarning, without an itemised statement, and without consent. Muriuki’s response was blunt: “I don’t believe you. This is theft.” He declared, with a finality that resonated across the platform, that Kenyan money was not safe with Safaricom, calling out what he described as the company’s “klepto ways.”

It should have ended there, as a single angry post from a lawyer. It did not. It became a flood.

Writer and commentator Beatrice Wanjiru, known on X as @Wordslinger__, captured the broader alarm when she described the situation as “actually a huge scandal,” noting that Safaricom appeared to be arbitrarily deducting money from M-Pesa accounts in the name of unexplained Fuliza debts, with some customers claiming to have never activated Fuliza in the first place and others insisting they had long repaid any balances. Dozens of users replied with their own screenshots. The deductions ranged from KSh 27 to over KSh 1,300. The justification in each case was virtually identical: the same vague three-week window, the same absence of exact dates, the same take-it-or-leave-it tone.

One user reported being charged KSh 78 despite swearing they had not activated Fuliza. Another lost KSh 213. A third was hit twice in consecutive days. Several customers noted they received no SMS notification before the deduction, only a puzzling message after the fact that referenced a date range too broad to verify against any specific transaction. “They can’t even pinpoint the exact date,” one post read, capturing a frustration shared by hundreds.

Safaricom’s official explanation, offered through customer care channels and later amplified by local media, is that a technical fault prevented the system from billing daily Fuliza fees between February 26 and March 20, 2026. A one-time catch-up adjustment was applied across all affected accounts simultaneously, and the company insisted that no further deductions would follow. “This one adjustment has been made to cover all, and there won’t be any further adjustments,” the company told at least one customer.

But the explanation invites more questions than it answers. Why was the adjustment applied without notice? Why were no itemised statements provided? If the fault was purely in the billing cycle, how do customers who claim never to have activated Fuliza appear in the affected pool? And perhaps most damning: who audits the audit? Safaricom has not offered to publish aggregate figures on the total amount recovered through this exercise, the number of accounts touched, or the basis on which individual deduction amounts were calculated. For a company handling billions of shillings in daily transactions on behalf of over 30 million subscribers, this silence is its own indictment.

This is not the first time. It will not be the last.

The Fuliza scandal of March 2026 does not exist in isolation. It is the latest episode in a long-running pattern of Safaricom controversies touching on money, data, and the accountability deficit of a monopoly that has grown too large and too politically connected for ordinary Kenyans to effectively challenge.

In February 2026, weeks before the latest deductions surfaced, Nairobi businesswoman Eunice Nganga filed a constitutional petition challenging Safaricom’s policy of automatically applying erroneous M-Pesa transfers to settle recipients’ Fuliza debts. Nganga had accidentally sent KSh 2,700 to the wrong mobile number in September 2024 and immediately initiated Safaricom’s standard reversal procedure. Safaricom refused, citing the unintended recipient’s outstanding Fuliza overdraft. The funds were automatically redirected to clear that debt without Nganga’s consent and without the recipient ever accessing or withdrawing the money. 

Nganga’s central legal argument is that her contract with Safaricom does not extend to settling another customer’s debts using her funds, particularly where no valid transaction existed between her and the Fuliza debtor.  The case, assigned to Justice Lawrence Mugambi, was scheduled for mention on March 25, 2026. She is seeking a declaration that the policy is unconstitutional and unlawful, a refund of the KSh 2,700, broader restitution for other affected customers, and KSh 50 million in general and punitive damages.  It is a case of profound public interest. Many Kenyans have never heard of it.

Before Nganga, there was a class-action suit that shook Safaricom’s boardroom in 2023. Three M-Pesa users, Gichuki Waigwa, Lucy Nzola, and Godfrey Okutoyi, sued Safaricom, Vodafone Group, the Central Bank of Kenya, and the Communications Authority of Kenya, alleging that the Fuliza overdraft facility illegally used money belonging to non-borrowing M-Pesa users and that Safaricom was effectively engaged in banking business without being licensed as a bank under the Banking Act.  They further claimed that the trust account into which M-Pesa funds were collected was a “sham trust,” and that Safaricom and M-Pesa Holding had commingled funds, resulting in Vodafone Group owing M-Pesa account holders KSh 305 billion.  The case, still winding through the courts, represents perhaps the most sweeping legal challenge to M-Pesa’s financial architecture.

In September 2025, Safaricom was forced to temporarily suspend Fuliza following a technical disruption that halted repayment transactions. Customers were left uncertain about their loan status, with some worried that fees would accumulate unnoticed before normal billing resumed.  That fear, it turns out, was not unfounded. Five months later, Safaricom was telling customers that fees had indeed been accruing unseen in the background, and was now reclaiming them in bulk.

Even Fuliza’s criminal underbelly has been documented. The Directorate of Criminal Investigations alleged that a syndicate of eight young men in Nakuru and Trans-Nzoia defrauded Safaricom of close to KSh 500 million by using fraudulently registered SIM cards to take Fuliza loans with no intention of repayment.  Over 123,000 new mobile numbers opted into Fuliza in a single month before being switched off or vacated, leaving no trace of the borrowers.  The scale of that fraud raises its own disturbing question: if the Fuliza system was penetrated so comprehensively by outside actors, what assurance do ordinary subscribers have that the billing infrastructure tracking their personal balances is accurate?

Bonga Points, Vanishing in the Night

As if the Fuliza scandal were not enough, the very same weekend it erupted, a second alarm was going off inside Safaricom’s ecosystem. On March 29, reports surfaced of Bonga Points being transferred to unknown recipients in a series of early-morning transactions, with message logs showing multiple redemptions occurring between 2 a.m. and 7 a.m., draining account balances without user authorisation. 

Safaricom confirmed on Sunday, March 29, that it had detected irregularities involving unauthorised redemption of Bonga Points, indicating that some users may have had their points accessed without consent.  The timing of the Bonga fraud, arriving in the same news cycle as the Fuliza deductions scandal, is devastating for a company already under intense public scrutiny. Two separate incidents, both involving Safaricom customer value being removed from accounts without consent, surfacing within 48 hours.

The Bonga Points story also carries its own deeper history of bad faith. In 2022, Safaricom attempted to expire Bonga Points accumulated before December 31, 2019, citing liabilities of KSh 4.5 billion sitting on its books. A High Court judge later quashed the move, ruling that Bonga Points, once awarded, become the customer’s property and Safaricom ceases to have any right over them.  The court’s declaration was unambiguous. That Safaricom attempted such a seizure in the first place, targeting KSh 4.5 billion in customer-owned value through a clause change, speaks to a corporate culture comfortable with taking from subscribers when the legal landscape appears permissive.

A Company That Ignores Parliament

What makes Safaricom’s accountability crisis truly remarkable is its apparent contempt for the oversight institutions meant to hold it in check. The Senate Standing Committee on Information, Communication and Technology had convened a meeting on March 17, 2026, specifically to hear from Safaricom’s Chief Executive Officer on matters of service delivery and data protection. Safaricom did not appear. 

The committee had also sought to deliberate on a statement from Migori Senator Eddy Oketch regarding alleged breaches of confidential subscriber information by Safaricom. Senators warned that continued failure to honour parliamentary invitations may attract further action and expressed concern that the company’s absence undermines the oversight mandate on matters directly affecting millions of subscribers. 

That snub sits within a broader pattern of parliamentary frustration. Senators have been trying for over a year to extract answers from Safaricom on data privacy. The central question is whether Safaricom shares subscriber data, including location information, with government agencies without customer consent.  Safaricom has denied doing so without court orders. But two former senior managers at the company were accused of harvesting personal data on 11.5 million subscribers, including names, ID numbers, phone contacts, betting histories, and geolocation data, and attempting to sell the trove to a sports betting firm.  At the time the court case was filed, Safaricom admitted it had been unable to access or delete the compromised data from the Google Drive where it had been stored. 

In other words: the private information of nearly a quarter of Safaricom’s entire customer base was floating somewhere on the internet, and the company that collected it could not even reach it to delete it.

The Economics of Micro-Theft

Commentators on X this week raised the darkest arithmetic of the Fuliza billing scandal. If Safaricom deducted an average of KSh 100 from each of even one million accounts through this “adjustment,” that is KSh 100 million recovered without court order, without notice, and without the possibility of meaningful individual challenge. Few Kenyans will file a consumer complaint over KSh 60. Fewer still will sue. This is precisely why the amounts are small. The aggregate sum, however, is not.

Safaricom’s Fuliza book is enormous. It disburses the equivalent of tens of millions of US dollars daily. Even fractional billing irregularities, applied across that base, generate material sums. The company has offered no aggregate disclosure of the total recovered through the March correction, no explanation of why the system failed to bill for three full weeks, and no independent audit. It has, instead, offered apologies.

For millions of Kenyans, M-Pesa is not a convenience. It is the only financial infrastructure they have. Their rent, their children’s school fees, their hospital payments, their small business cash flows, all of it moves through Safaricom’s pipes. The question being asked on the streets of Nairobi and in the replies of thousands of X posts is the same one lawyers are now beginning to formalise into court papers: who gave Safaricom the right to help itself?

What Must Happen

The Communications Authority of Kenya has a mandate. The Office of the Data Protection Commissioner has teeth. The courts have, when pushed, sided with consumers. What is missing is the political will to push. Safaricom is part-owned by Telkom South Africa through Vodacom, is listed on the Nairobi Securities Exchange, and its M-Pesa operations are so deeply embedded in Kenya’s financial architecture that destabilising the company is not an option anyone in authority wants to pursue. That very indispensability has become its greatest protection against accountability.

But indispensability is not impunity. The Senate ICT Committee must compel Safaricom’s CEO to appear and answer, under oath if necessary, for the Fuliza billing collapse, the Bonga Points fraud, and the data protection failures. The Communications Authority must formally investigate whether the mass deductions of March 2026 comply with Section 83C of the Kenya Information and Communications Act. The Central Bank of Kenya, whose M-Pesa oversight role was explicitly criticised in the KSh 305 billion class-action suit, must explain what safeguards exist to prevent Safaricom from conducting bulk account adjustments outside the normal consumer consent framework.

And every affected Kenyan, whether they lost KSh 27 or KSh 1,300, should file a formal complaint with the Communications Authority. The CA’s complaint registry is a public record. Volume is evidence. Evidence is leverage.

For now, the most honest thing that can be said about Kenya’s relationship with Safaricom is this: millions of Kenyans trust it with their money, their identity, their location, and their communication. Safaricom, on the evidence accumulated across years of litigation, regulatory evasion, and parliamentary no-shows, has not earned that trust. It has merely inherited it, in the absence of any viable alternative.

That is not a business model. That is a hostage situation.

Kenya Insights will continue tracking the Fuliza deductions case, the Eunice Nganga constitutional petition, and the Senate ICT Committee proceedings. Affected subscribers are encouraged to document their deductions and file formal complaints with the Communications Authority of Kenya via their website or by calling 0800 221 772.

The Orange Democratic Movement has never been accused of doing things quietly. But the scale of extravagance at its Special National Delegates Convention at the ASK Jamhuri Grounds last Friday made even hardened political observers raise an eyebrow. A party currently locked in a bitter and public feud over money, legitimacy and leadership reportedly spent at least Sh40 million in a single day to put on the most ostentatious show of political force seen in Nairobi since the last general election.

Three thousand delegates. Branded merchandise. Chartered buses. Catered meals served in shifts. Mobile money disbursements handled by a contracted firm. Security so tight that journalists were shepherded in and out of the venue on party buses. It was not a political convention so much as a carefully produced political spectacle, and every shilling of it was designed to send one message: ODM is still here, still powerful and, above all, still very much open for business.

“The entire process is estimated to cost about Sh40 million,” a senior party official on the organising committee told The Star, speaking in confidence. “Posters, merchandise, food, transport, accommodation, everything that has gone into making the event a success is around that figure.”

The money, according to party officials, was drawn from ODM’s accounts and disbursed through a structured system, with delegates receiving transport and sitting allowances via mobile money from a third-party firm. Delegates from within Nairobi collected approximately Sh5,000 each, while those making the journey from far-flung regions pocketed upwards of Sh20,000. Delegates from Kisumu, a four-hour drive away, received Sh9,000 per head. Across 3,000 delegates, that delegate facilitation alone runs into the tens of millions before a single crate of water is factored in.

Nairobi County branch chairman George Aladwa confirmed that capital-based delegates received their dues without incident, a rare and notable achievement at large-scale political gatherings, where delayed payments have historically sparked chaos and stampedes. That the money flowed on time, through a single contracted firm, points to a level of financial management that ODM has not always been able to demonstrate. It also raises pointed questions about where, exactly, the money came from.

The question of funding has become the most combustible issue in ODM’s savage internal war. Secretary General Edwin Sifuna, now removed from his position by a NEC resolution but still fighting through the courts, has repeatedly alleged that the Linda Ground faction’s rallies and gatherings have been bankrolled by “outsiders,” with some in his camp pointing directly at State House. Sifuna claimed in February that he, as a signatory to ODM’s accounts alongside National Treasurer Timothy Bosire, had not authorised any withdrawal sufficient to fund the string of Linda Ground rallies held across Kisumu, Kakamega, Busia and Kisii. “The money you see being spent in ODM rallies is not coming from ODM headquarters,” he said at the time. “There is parallel funding for activities clothed in ODM colours.”

The allegations stung. ODM National Chairperson and Homa Bay Governor Gladys Wanga moved swiftly to douse the flames. She explained that the national treasurer’s signature is the only mandatory one required to release party funds and that six other signatories can co-authorise expenditure. “There is political party funding in this country, and ODM is entitled to the second largest share. We have money as a party,” she said. Oburu Oginga, now the ratified party leader following the death of his brother Raila Odinga in October 2025, denied that State House had any hand in ODM’s activities.

But the questions have not gone away. The Political Parties Fund, administered by the National Treasury, is at the centre of a long-running legal dispute between ODM and the government. ODM claims it is owed Sh12.6 billion in accumulated, unpaid statutory party funding. That dispute has escalated to the point where the party’s Central Committee resolved last year to pursue execution proceedings against the Treasury. Yet on Friday, Sh40 million appeared to flow with seamless efficiency.

“We haven’t received about Sh12 billion from the exchequer, but we get our quarterly shares, so we were able to fund the programme,” a senior official involved in organising Friday’s convention told The Star. The quarterly disbursements, officials insist, are sufficient to bankroll a convention of this magnitude. Independent analysts are less certain. Sh40 million is a substantial sum for a party that simultaneously claims financial persecution at the hands of the Treasury and faces the additional complication of a sitting secretary general who refuses to recognise the legitimacy of the NDC that authorised the expenditure.

The convention itself unfolded against the backdrop of the most serious internal rupture in ODM’s 20-year history. While Oburu and his Linda Ground faction occupied the ASK Dome at Jamhuri Grounds, Sifuna led a parallel “People’s Convention” eight kilometres away at Ufungamano House, forcing his way through a police blockade with allies including Siaya Governor James Orengo, Vihiga Senator Godfrey Osotsi and Embakasi East MP Babu Owino. Anti-riot police had sealed off Ufungamano House early in the morning, turning away delegates and journalists before Sifuna’s contingent breached the cordon. The symbolism was hard to miss: two events, one party, and a police force whose deployment favoured one side over the other.

Sifuna’s faction dismissed the Jamhuri convention as constitutionally illegitimate. He argued that only the secretary general, under the ODM constitution, can legally convene a National Delegates Conference and that the 21-day notice issued by his rival Catherine Omanyo, whom he does not recognise as acting secretary general, was therefore void. “Convention bandia,” was his verdict. His allies were more blunt. “Who said Oburu should be ODM’s party leader? Did you elect him?” Sifuna demanded, in a remark that landed heavily given that Oburu was installed, in Sifuna’s telling, even before Raila’s body had arrived back in Kenya from India.

The Political Parties Disputes Tribunal declined to stop the convention. In its ruling on March 26, the tribunal struck out Sifuna’s petition on the procedural ground that he had not exhausted ODM’s internal dispute resolution mechanisms before approaching the tribunal. The ruling cleared the runway for Jamhuri. It did not resolve the underlying constitutional questions, which remain live and may yet find their way back to a higher forum.

At Jamhuri, in the meantime, the theatre was spectacular. The convention ratified Oburu Oginga as substantive party leader, installed Kisii Governor Simba Arati and Mombasa Governor Abdulswamad Nassir as deputy party leaders, and removed Osotsi from his position as deputy leader. The delegates also ratified a National Executive Committee resolution under Article 87 of the ODM constitution, formally authorising the party to open coalition talks with President William Ruto’s United Democratic Alliance, a decision that represents ODM’s most dramatic strategic pivot since its founding.

Junet Mohamed, the Suna East MP and Minority Leader in the National Assembly, struck a combative tone that drew roars from the crowd. “Anyone in this country who wants to negotiate with ODM, we will not negotiate on our parliamentary strength,” he declared, hinting heavily at a zoning arrangement for the 2027 elections. “Anywhere we have an MCA, MP, Senator, Governor, Woman Rep, it will remain with ODM. Don’t joke with ODM because if they are angered, they can cause problems.” The implicit threat was aimed at UDA, but it was loud enough to reach Sifuna at Ufungamano as well.

Winnie Odinga, daughter of the late Raila and until recently an ally of Sifuna’s faction, chose to appear at Jamhuri, delivering a carefully worded speech that congratulated Oburu while pressing for youth inclusion and a more open party culture. Her presence was read as a significant political signal, a cautious swing toward the mainstream Oburu structure even as she continued to advocate for reforms from within. “When we talk about the new ODM, we want a party that opens doors, not closes them,” she said. Oburu responded with a conciliatory promise not to expel rebels, though he stopped well short of inviting Sifuna back to the table.

Wanga, ratified as national chairperson, described the event as “inspiring, engaging, productive and historic,” a characterisation that her rivals at Ufungamano would contest every word of. The party’s organisational prowess on the day was genuine and, for ODM’s purposes, politically valuable. The buses ran on time. The mobile money transferred without drama. The delegates ate. The leadership was installed. The coalition mandate was secured. The event was, by any operational measure, a success.

The harder test comes next. ODM now enters coalition talks with UDA carrying a fractured internal structure, a disputed secretary general, a Sh12.6 billion funding grievance against the government it is proposing to partner with, and questions about the provenance of the very money it spent to get here. Forty million shillings can buy a spectacular day. What it cannot buy, as ODM is about to discover, is a united party.

Kenya Airways has long been a repository of broken promises. Since the carrier last sustained a full year of profit in 2012, it has accumulated more than Sh172 billion in net losses, absorbed successive government bailouts drawn from taxpayer funds, cycled through chief executives, and lurched between restructuring plans bearing the kind of names that inspire confidence at board level but rarely at the bottom line. Kifaru. Project Kifaru.

The Pride of Africa. Each iteration repackages the same painful truth: that the national carrier remains one of the most financially distressed airlines on the continent, propped up by state patronage and perpetually one crisis away from catastrophe.

The audited group results for the year ended December 31, 2025, published this Tuesday morning, confirm what investors and aviation analysts had quietly accepted since August last year: the one glimmer of profitability that made Kenya Airways the brief darling of Nairobi Securities Exchange watchers is gone.

The airline recorded a net loss of Sh17.2 billion in 2025, a savage reversal from the Sh5.4 billion profit posted in 2024 that management had trumpeted as the carrier’s first net profit in over eleven years. Total income collapsed from Sh188.5 billion to Sh161.47 billion.

The airline’s operating loss stood at Sh5.61 billion, against an operating profit of Sh16.62 billion the previous year.

Finance costs alone consumed Sh12.4 billion, dwarfing the paltry Sh79 million in interest income and producing a loss before tax of Sh17.93 billion. After a tax credit of Sh764 million, the net loss attributable to shareholders was Sh17.13 billion. Total comprehensive loss for the year reached Sh13.81 billion.

It is a set of numbers that should horrify any board of directors. And yet, against the backdrop of what Kenya Airways has endured across the past decade and a half, it lands with a peculiar, wearying familiarity.

A Decade of Ruin, a Flicker of Light

The story of Kenya Airways’ financial decline is by now a well-worn narrative in Kenyan business journalism, but its scale bears repeating. The carrier’s accumulated net losses from 2013 to 2022 exceeded Sh172 billion.

In financial year 2022 alone, the airline posted a loss of Sh38.26 billion, the tenth consecutive year in which the once-celebrated airline had delivered red ink to its shareholders. The trajectory was not merely bad. It was catastrophic. By 2023, equity had fallen to negative Sh138.1 billion. The airline’s shareholders had long ceased to own anything of value.

Yet something unexpected happened. Under the stewardship of Allan Kilavuka, who took the helm in April 2020 at the nadir of the global pandemic, the airline embarked on a structural reset it called Project Kifaru.

The three-stage plan, launched in 2021, converted aircraft to cargo operations, diversified revenue beyond passenger traffic, renegotiated lease agreements, and enforced a stringent regime of cost control.

Kilavuka, a former General Electric executive who had spent years understanding balance sheets before ever running an airline, pursued the debt restructuring with uncommon discipline. In 2023, Kenya Airways converted 85 percent of its foreign-currency debt into shilling-denominated loans, a move that dramatically curtailed the foreign exchange losses that had ravaged prior years. The 2023 full year results delivered an operating profit of Sh10.5 billion, a 287 percent improvement over the prior year, and the first operating profit in six years.

Then, in March 2025, Kilavuka announced what no Kenya Airways chief executive had been able to say since 2012: the airline had turned a net profit.

At Sh5.4 billion, the figure was modest against the scale of accumulated losses and deeply negative equity, which had improved but still stood at negative Sh118.2 billion by year-end 2024.

A stronger Kenyan shilling provided Sh10.55 billion in foreign exchange gains against a Sh15.04 billion forex loss the previous year. Cargo revenues had risen sharply. Passenger numbers reached 5.2 million.

EBITDA margin hit 20 percent, above the industry average of 17 percent. The airline carried more freight and more passengers than at any point in its history. Kilavuka declared Kenya Airways no longer merely an airline in recovery, but an airline in ascent. The board extended his contract. The press called it a miracle.

It lasted one year.

Dreamliners Become Nightmares

The mechanism of Kenya Airways’ return to loss is brutally specific. The airline operates nine Boeing 787-8 Dreamliner aircraft, its entire wide-body fleet and the backbone of its long-haul operations to Europe, North America, Asia and the Middle East.

These nine jets, averaging just over ten years in service and all powered by General Electric GEnx-1B engines, are the aircraft that fly to London, Paris, New York and Amsterdam. They are the planes on which Kenya Airways generates the yield that sustains everything else.

Beginning in late 2024 and accelerating through the first quarter of 2025, a global shortage of spare engine parts caused the maintenance overhaul timelines for GEnx-1B engines to balloon. Overhauls that had previously taken sixty days began taking ninety to one hundred and twenty days.

Kenya Airways found itself unable to return aircraft from maintenance on schedule. By the time the first-half results were published in August 2025, three of its nine Dreamliners, a full third of the wide-body fleet, were on the ground.

The aircraft are 5Y-KZA, named The Great Rift Valley, one of the oldest in the fleet and grounded in Nairobi; 5Y-KZC; and 5Y-KZH. Capacity dropped 16 percent year-on-year. Available seat kilometres fell from 7,991 million to 6,715 million.

Passenger numbers fell 14 percent. Revenue for the first half of 2025 alone came in at Sh75 billion, a 19 percent decline against the Sh91 billion recorded in the same period of 2024.

Kenya Airways is not alone in suffering from this malaise. British Airways has made repeated changes to its 787 schedule. Air New Zealand grounded units of its own Dreamliner fleet. Vietnam Airlines reported maintenance overruns of more than 30 days beyond contracted timelines.

The crisis is an industry-wide indictment of a global aviation supply chain still unwinding from the dislocations of the Covid-19 pandemic. For airlines with large, diversified fleets and deep pockets, the grounding of a handful of widebodies is a manageable irritant.

For Kenya Airways, with its slim fleet, its precarious capital structure and its still-negative equity, the loss of one-third of its long-haul capacity was existential in impact.

By November 2025, the airline had issued a formal profit warning, telling investors that full-year 2025 earnings would fall by at least 25 percent against 2024.

That estimate, it now emerges, was optimistic. The audited results reveal a swing from a Sh5.4 billion profit to a Sh17.2 billion loss. One aircraft returned from maintenance in July 2025.

The remaining two remained grounded through the full financial year. Fleet ownership costs rose 29 percent as lease remeasurements bit. Operating costs fell slightly to Sh167.08 billion from Sh171.87 billion as the airline scaled back flying, but the revenue collapse overwhelmed any cost savings.

It is the mathematics of a company running on thin ice that simply could not replace the income it had lost.

A CEO Departs, a Vacuum Opens

The financial collapse of 2025 was not the only turbulence Kenya Airways absorbed. In December of that year, Allan Kilavuka exited the airline, proceeding on terminal leave ahead of the formal expiry of his contract on March 31, 2026. It was a muted departure for the man credited with engineering the carrier’s brief return to profit

The board appointed Captain George Kamal, the airline’s chief operating officer, as acting group managing director and CEO effective December 16, 2025.

Kamal is an experienced aviation executive with nearly three decades in the industry, having held senior roles at Etihad Airways, Air Arabia and Iraqi Airways, where he was chief operations and executive officer.

He holds a doctorate in business administration and an MSc in aviation management. He is not, however, a permanent appointment.

The search for a substantive successor to Kilavuka was ongoing at the time the 2025 full-year results landed. The leadership vacuum is compounded by a separate governance gap at board level: Michael Joseph, who chaired the Kenya Airways board, retired in June 2025 and has not been replaced.

Treasury Cabinet Secretary John Mbadi acknowledged in December that the government was focused on filling both positions before advancing the search for a strategic investor.

The sequencing tells its own story about where Kenya Airways stands. An airline seeking a strategic partner to inject capital into its deeply negative balance sheet must do so simultaneously while finding new permanent leadership and reconstituting its board. It is a demanding set of tasks under ideal conditions. Under current conditions, it constitutes a governance crisis that no amount of buoyant load factor data can fully obscure.

The Middle East Windfall

And yet, on the very morning that Kenya Airways released the worst results in recent memory, acting chief executive George Kamal stood before reporters in Nairobi to announce something quite different: demand for seats on the airline’s flights is surging, and the reason is war.

The US-Israeli military campaign against Iran, which escalated dramatically with strikes against Iranian territory on February 28, 2026, has redrawn the global aviation map.

Middle Eastern carriers, among the most powerful in the world, have been thrown into operational chaos. Emirates, operating out of Dubai, fell to roughly three-quarters of its pre-conflict capacity. Flydubai was running at approximately a third.

Qatar Airways, which had built much of its transcontinental dominance on its Doha hub, was operating at around 20 percent of normal levels. More than 20,000 flights were cancelled across the region in the immediate aftermath of the strikes.

Airports in the Gulf that serve as critical transit nodes for traffic between Africa, Europe, Asia and the Americas were disrupted at a scale not seen since the pandemic.

Kenya Airways, whose network routes through Nairobi rather than any Middle Eastern hub, found itself in an unexpected position of competitive advantage. Passengers who would ordinarily transit through Dubai, Doha or Abu Dhabi on the way between Europe and East or Southern Africa began seeking alternatives.

The airline’s seat load factor, which had averaged 70 percent as recently as January 2026, climbed rapidly from February onward. By the time Kamal addressed reporters on March 23, it had reached between 90 and 99 percent on some routes. The gains are concentrated on the airline’s most valuable corridors: Europe, the United States and Asia.

The airline is planning to add flights on a number of routes in response to the demand surge. It is sourcing additional jet fuel from India, with its flight operations head Paul Njoroge disclosing that the airline currently holds approximately 56 days of supply.

The Iran conflict has also driven up global oil prices, adding Brent crude costs that will filter into operating expenses in the months ahead. At Sh12,950 per barrel as of this week, fuel is a growing concern.

But for an airline with planes flying at near-maximum capacity after a year in which those same planes sat half-empty on thinned-out long-haul schedules, full aircraft in 2026 represent a potentially transformative revenue opportunity.

The irony is not lost on analysts watching the stock. Kenya Airways has spent the past twelve months haemorrhaging income because its aircraft were on the ground.

The Iran war has generated demand that the airline can, for the first time in a difficult period, actually meet, because by March 2026 its Dreamliner fleet has been progressively restored to service. One aircraft returned in July 2025. The other two returned later in the second half of the year.

The full-year results thus reflect a period in which the revenue damage was done before the capacity was recovered, a cruel timing mismatch that will not be lost on the new acting CEO.

The Balance Sheet That Never Heals

Behind the demand surge, the underlying financial architecture of Kenya Airways remains deeply alarming. Despite the Sh5.4 billion profit of 2024, the airline’s equity position had improved only marginally to negative Sh118.2 billion.

The 2025 loss of Sh17.13 billion attributable to shareholders will push that figure deeper into negative territory when the 2025 balance sheet is fully analysed.

Total comprehensive loss for 2025 was Sh13.81 billion. The airline’s basic loss per share was Sh2.94, against basic earnings per share of Sh0.95 in 2024. The trajectory is a reminder that a single profitable year, however celebrated, does not reverse twelve years of structural destruction.

The airline’s recapitalisation plan remains the missing centrepiece of any credible recovery narrative.

Management has articulated a target of raising approximately $500 million by early 2026 to expand the fleet from its current base to more than 50 aircraft over five years, to retire the aging Embraer 190s that serve as the workhorses of regional operations, and to bring in Boeing 737 MAX 8 aircraft.

The government, which holds a 49 percent stake, has been working with National Treasury on plans to convert a portion of novated government debt into equity to make room for a strategic investor without diluting the state beyond acceptable political limits. That investor has not materialised.

The leadership gaps have, in the Treasury’s own words, complicated the process. The $500 million target may require recalibration against a balance sheet that has just deteriorated by more than Sh17 billion in a single year.

What the Iran conflict cannot fix is the fundamental equation facing Kenya Airways: that it operates a small fleet on a continent with limited aviation infrastructure, with a capital base that is deeply negative, a fuel bill that is rising, engine maintenance costs that remain elevated, and a governance structure that is in transition at precisely the moment it most needs stability.

The load factors of March 2026 are real. The revenue they generate is real. But the airline’s finance costs were Sh12.4 billion in 2025, and that number does not diminish because passengers are fleeing a war.

The Wider Diagnosis

Kenya Airways’ story is not merely the story of one airline. It is the story of African aviation’s structural condition.

The continent’s carriers operate older fleets, face higher maintenance costs because the continent lacks major MRO capability, service their dollar-denominated debt with currencies that are chronically weak, and compete on long-haul routes against state-subsidised behemoths in the Gulf, East Asia and Europe.

When those Gulf carriers are grounded by war, the mathematics change briefly and dramatically. When they return to full capacity, as they inevitably will, the structural pressures return with them.

Allan Kilavuka, who built the most credible recovery Kenya Airways has seen in over a decade, was fond of pointing out that the airline’s EBITDA margin in its best year was competitive with global industry averages. He was correct.

But EBITDA margin measured against revenues does not pay down negative equity of Sh118 billion. It does not retire dollar-denominated debt. It does not replace a fleet whose average age is climbing.

And it does not survive a year in which a third of your most important aircraft are on the ground because a supply chain for engine components, disrupted first by a pandemic and then by years of underinvestment, has not recovered.

George Kamal inherits an airline that is flying full today, losing heavily on paper, and searching for money, leadership and a strategic direction simultaneously.

The Pride of Africa has been here before. The question is whether the Iran war’s unexpected dividend can be converted into something more durable than the one-year miracle that preceded it.

Kenya Airways (KQ) is listed on the Nairobi Securities Exchange. The airline’s 2025 audited group results were published on March 24, 2026. All figures in Kenya shillings unless otherwise stated.

Kenya woke up on Monday, March 23, to a quiet but unmistakable crisis. Shell-branded Vivo Energy stations along Magadi Road and in Kiserian had been running intermittently dry since Saturday.

The company’s outlet at Kipande House in Nairobi’s central business district exhausted its diesel stocks by morning and expected its petrol supplies to disappear before nightfall.

Across the city, taxi drivers were making five-stop odysseys searching for fuel. Boda boda operators in South B, South C and Nairobi West found nothing. A Westlands-based taxi driver named Steve Wakio told reporters he was forced to abandon his car and borrow a motorcycle to locate a dispensing pump near Wilson Airport.

That same morning, the United Energy and Petroleum Association, the lobby group representing Kenya’s network of independent petroleum dealers, dropped what can only be described as an ultimatum. Through its chairperson Irene Kimathi, UNEPA warned that its members would halt fuel supply nationwide unless the Energy and Petroleum Regulatory Authority reviewed pump prices upward immediately.

The threat was stark. The framing was urgent. And the timing, delivered against the backdrop of the worst global oil supply shock since the 1970s, was carefully chosen.

This story is not simply about a fuel shortage. It is about who is exploiting that shortage, who is being hurt by it, and whether the regulatory architecture of Kenya’s downstream petroleum sector is fit to withstand the kind of geopolitical earthquake currently unfolding in the Middle East.

The War That Started Everything

On February 28, 2026, the United States and Israel launched Operation Epic Fury, a coordinated airstrike campaign targeting military, nuclear and leadership infrastructure inside Iran, including attacks that resulted in the death of Supreme Leader Ali Khamenei.

Iran’s response was immediate and strategically catastrophic for global energy markets. Its Islamic Revolutionary Guard Corps issued prohibitions on vessel passage through the Strait of Hormuz, backed up by missile and drone attacks on commercial shipping. By March 12, Iran had confirmed 21 attacks on merchant vessels.

Tanker traffic through the strait, which in normal times carries roughly 20 percent of global seaborne oil trade, collapsed by approximately 70 percent, with more than 150 ships anchoring outside the chokepoint rather than risk transit.

The numbers are staggering. Brent crude surpassed $100 per barrel on March 8 for the first time in four years. It peaked above $126. By March 23, Brent was trading above $113 per barrel, a jump of more than $40 from the pre-war baseline of roughly $70.

The International Energy Agency, in language it has never previously used, described the situation as the greatest global energy and food security challenge in history.

The IEA’s member countries responded with the largest coordinated release of emergency oil reserves ever recorded, nearly 400 million barrels, equivalent to one-third of total government reserve holdings.

East and southern Africa are disproportionately exposed.

According to CITAC energy consultancy executive director Elitsa Georgieva, approximately 75 percent of the fuel imports consumed by the region originate from the Middle East.

Kenya, which consumes about 100,000 barrels of petroleum products daily and imports 100 percent of its refined fuel requirements, sits at the sharp end of that vulnerability.

The country’s sole refinery at Mombasa has been dormant for years after being shut down on grounds of economic unviability, a decision that left Kenya permanently dependent on refining capacity in the Gulf, India and Southeast Asia. That capacity is now under siege.

“The biggest fuel suppliers to Kenya are rationing product. A few distributors are experiencing stockouts in the villages.” — Martin Chomba, Petroleum Outlets Association of Kenya

Industry insiders speaking to the Daily Nation indicated that one vessel expected to deliver 85 million litres of fuel arrived having loaded only 60 million litres, the shortfall directly attributable to safety concerns during transit through the Strait of Hormuz.

Of approximately 60 vessels expected at Mombasa over a two-week window, only two were carrying petroleum products. The Shimanzi petroleum depot in Mombasa was being warned by fuel transporters of impending stockouts.

Saudi Arabia simultaneously announced reduced crude supply allocations to its Asian refinery clients for April 2026, a second consecutive month of cuts that will squeeze the secondary supply chains India, South Korea and Southeast Asian refiners use to produce the finished petroleum products that Kenya imports.

The G-to-G Deal Under Pressure

Kenya’s primary fuel import mechanism, the government-to-government arrangement originally designed to avert the dollar crisis of 2023, provides the country with a 180-day credit period for purchases from Saudi Aramco, the Emirates National Oil Company and Abu Dhabi National Oil Company.

The deal was renewed and extended to 2028. It was supposed to represent supply security. Instead, it has become the primary source of anxiety, because all three suppliers have reported attacks on their refining infrastructure since the war began, have experienced facility shutdowns and have begun rationing the cargoes they allocate to importers.

Energy and Petroleum Cabinet Secretary Opiyo Wandayi summoned oil marketers for an emergency meeting as early as March 10, assuring the public that Kenya held adequate reserves and that G-to-G contingency planning with Aramco, ADNOC and ENOC was underway.

He said imports had been secured through to the end of April 2026.

However, the situation on the ground contradicted official assurances almost immediately. Petroleum Principal Secretary Mohamed Liban was reduced to issuing a statement through a Member of Parliament’s live television interview on March 23, blaming the apparent shortages on hoarding by oil marketers who were speculating on price increases.

Industry insiders described a market in which wholesalers were refusing to sell to independent dealers at regulated prices, prioritising franchised outlets or simply withholding stock in anticipation of higher margins following the next EPRA price review.

Who is UNEPA, and What Does It Actually Want?

Understanding the UNEPA ultimatum requires understanding what UNEPA represents and what it has been demanding from the regulatory system for years, because this is not the first time Irene Kimathi and the association have threatened fuel supply disruption as a lever against the regulator.

UNEPA is the umbrella body for Kenya’s independent, non-franchised petroleum dealers.

These are the roughly 800 retail outlets operating outside the direct supply networks of multinationals like Vivo Energy, TotalEnergies and Rubis. Independent dealers occupy the bottom rung of the downstream market hierarchy.

They do not import fuel.

They purchase from wholesale Oil Marketing Companies who do, and they retail it to end consumers at EPRA-regulated maximum prices. Their margins, their operating costs and their profitability are all tightly constrained by EPRA’s monthly pricing formula.

The structural grievance is genuine and documented. EPRA’s pricing formula sets both a maximum retail price and an OMC wholesale margin.

For years, independent dealers complained that large oil marketing companies were selling to them at wholesale prices that, once dealer transport and operating costs were added, left margins so thin as to make the business unviable.

A 2022 statement by Kimathi, then serving as Mt Kenya East Petroleum Dealers Association chairperson, captured it plainly: large OMCs were selling to independent dealers at prices near the retail cap in Nairobi, making it impossible for rural dealers who bore additional transport costs to operate profitably.

The complaint was that wholesale price caps, while officially set by EPRA’s formula, were not being enforced in practice against the major suppliers.

EPRA did respond, over time. In March 2025, the regulator implemented the first phase of recommendations from its Cost of Service Study for Petroleum Products, raising OMC operating margins for super petrol from Ksh 12.39 per litre to Ksh 15.24, with comparable increases for diesel and kerosene.

A second phase increase followed in July 2025, producing the largest single pump price spike in over a year.

A third phase increase is scheduled for July 2026. In total, the cost-of-service study identified that combined retail margins should be raised from the then-current Ksh 8.19 per litre to Ksh 12.78, a revision that the IEA Kenya research unit warned could reflect industry self-interest, given that oil marketing companies themselves were key informants in the data collection underpinning the study.

The point is this: the regulated margin for fuel dealers in Kenya has been increasing. EPRA has been responsive to dealer cost pressures. The claim that current prices are unsustainable because margins have not been reviewed since 2019, which Kimathi made in 2022, is factually superseded by the 2025 revisions.

What UNEPA now demands is something categorically different: the suspension of price regulation altogether during the present crisis, to allow market forces to set the pump price at whatever the global disruption dictates. That is not a margin adjustment. That is deregulation by emergency decree.

The retail margin for super petrol was Ksh 12.39 per litre in early 2025. After EPRA’s phased revisions, it stands at over Ksh 15 per litre. The claim that margins have been frozen is false.

The Hoarding Problem: Blackmail or Business Reality?

The government’s own account of what is driving the visible shortage is damning. PS Liban on March 23 explicitly stated that oil marketers are hoarding fuel in anticipation of higher prices.

This is a precise description of speculative inventory behaviour: a dealer acquires or holds stock at current prices, withholds it from the pump, and waits for the regulatory review to set a higher price that will inflate the margin on the withheld volume.

It is not illegal.

It is, however, a manufactured shortage, and it is happening to ordinary Kenyans who need fuel to commute, farm, operate small businesses and access healthcare.

The Star’s spot check on March 23 found Nairobi’s Langata Road, one of the busiest arterial corridors in the capital, with multiple stations either dry or rationing supplies.

Reports from the North Rift indicated that Eldoret, Kitale, Kapsabet, Bungoma and parts of West Pokot had run out of diesel entirely, directly disrupting the planting season for large-scale farmers dependent on diesel-powered machinery.

Across a two-week shipping window at Mombasa, only two of 60 expected vessels were carrying petroleum products. The structural supply problem is real and worsening. The hoarding layer on top of it is a business calculation by dealers who believe EPRA will blink.

UNEPA’s threat to divert fuel to neighbouring countries, where prices are unregulated and therefore more profitable, deserves to be taken seriously not because it is economically easy but because it is legally possible and commercially rational. Kenya’s borders with Tanzania, Uganda and Ethiopia are not hermetically sealed.

Arbitrage across unregulated markets has occurred before. If a dealer can sell diesel at free-market prices in a neighbouring state and earn a higher margin than the EPRA formula permits in Kenya, the incentive exists. The warning is calibrated.

The EPRA Calculation and Its Defenders

The Energy and Petroleum Regulatory Authority’s decision on March 14 to maintain pump prices at their existing levels for the March to April cycle was not capricious.

EPRA Director General Daniel Kiptoo gave a specific technical explanation: the price review was based on vessels received and discharged between February 10 and March 9, 2026.

Most of those were February-priced cargoes, acquired before Operation Epic Fury began on February 28.

The landed cost data fed into the March formula therefore reflected pre-war pricing. Kiptoo was transparent about this: the impact of the Middle East situation had not yet been reflected in prices.

This means that the current Nairobi pump prices of Sh178.28 for super petrol, Sh166.54 for diesel, and Sh152.78 for kerosene are priced against a world that no longer exists.

The April 15 review, when EPRA calculates prices based on cargoes discharged in the post-war period, will capture the full landed cost shock of crude above $110 per barrel plus dramatically higher shipping insurance premiums.

Dealers know this.

The market knows this. Everyone knows that April 15 will bring a very large price jump, and the UNEPA threat is, at its core, a demand to bring that jump forward now rather than wait three weeks for the formal regulatory process to catch up with reality.

Epra’s timeline is legally defensible but economically awkward. The landed cost of diesel already rose 8.46 percent between January and February 2026, from $586.80 to $636.45 per cubic metre.

Kerosene rose 6.79 percent over the same period.

These were pre-war increases. The March figures, which will underpin the April 15 review, are expected to reflect far more severe increases.

If Brent has averaged above $110 per barrel throughout March while shipping costs and insurance premiums have also spiked, the next pricing cycle will produce a shock that EPRA cannot absorb within the existing formula without either passing it directly to consumers or deploying a fuel subsidy.

The Subsidy Trap and the Sceptics

The government has pledged to subsidise the increase in landed costs. Dealers are openly sceptical, and their scepticism is grounded in recent history.

Kenya’s 2022-2023 fuel subsidy programme accumulated billions of shillings in unpaid claims to dealers, creating a backlog that destroyed the working capital of smaller independent operators.

Kimathi herself described the historical pattern precisely: the government is often unable to refund subsidy claims on time, making it difficult for businesses to operate effectively. Given the current political climate, business people are not prepared to take such risks.

This is not an unreasonable position.

The Sh104 billion Hustler Fund has logged default rates exceeding 50 percent. The Affordable Housing Programme has generated procurement controversies. The SHA health insurance transition haemorrhaged billions in mismanaged funds.

The Kenyan state’s track record for honouring commercial obligations on schedule is poor.

A dealer who accepts regulated prices below their landed cost, on the basis that the government will reimburse the differential, is essentially extending unsecured credit to a state that has demonstrated a structural inability to pay on time.

The risk is not theoretical.

At the same time, the argument that dealers cannot wait three weeks for the April 15 review to formally capture war-era costs deserves scrutiny.

The EPRA formula exists to prevent price shocks from being passed to consumers instantaneously, precisely because immediate price pass-through of global commodity spikes is regressive: it hits the poorest households, who spend the highest proportion of their income on transport and cooking fuel, with the greatest force.

The cost of kerosene, at Sh152.78 per litre, is not an abstraction for households in Kibera, Mathare or Mukuru who use it for cooking.

The Market Structure Problem Nobody Wants to Discuss

There is a deeper problem underneath the immediate crisis that neither UNEPA nor EPRA nor the Ministry of Energy has chosen to address publicly.

Kenya’s downstream petroleum market is an oligopoly at the wholesale level disguised as a competitive retail market. EPRA tracks 144 registered Oil Marketing Companies.

The actual import and wholesale market is controlled by a handful of them. Vivo Energy alone controls 21.34 percent of total sales volume by the regulator’s own December 2024 figures. Rubis holds 15.4 percent. TotalEnergies holds 14.8 percent. The top three OMCs collectively command over 51 percent of the market.

The Open Tender System, through which fuel cargoes are imported and distributed to the downstream market, concentrates power in the hands of whichever OMCs win the tender round.

Independent dealers who are not participants in the Open Tender System purchase from these large importers.

When the large importers choose to ration supply, as they are doing now, independent dealers have nowhere else to go. The UNEPA complaint about large OMCs refusing to sell at regulated prices is a structural market power problem, not simply a crisis-specific phenomenon. The crisis has amplified an existing dysfunction.

Kenya lacks the strategic petroleum reserves that would give the state any leverage in this situation. The National Oil Corporation of Kenya was mandated to maintain a 90-day strategic reserve.

NOCK’s prolonged financial difficulties have prevented it from fulfilling that mandate. Oil marketing companies are legally required to maintain stocks for 20 to 25 days. Most maintain 15 to 18 days of cover.

Kenya entered this crisis structurally underprepared, and the government’s assurances of adequacy are harder to credit against that backdrop.

What Should Actually Happen

The UNEPA demand for immediate price deregulation is dangerous and should be rejected. Deregulating pump prices during a supply shock of this magnitude would not stabilise supply.

It would transfer the full cost of a geopolitical war, a war that ordinary Kenyans had no hand in starting, directly onto the most economically vulnerable consumers in the country.

The 2022-2023 subsidy experience was painful but it prevented the kind of cascading inflation that unregulated fuel pricing during a supply shock would produce. The regulatory floor exists for a reason.

What EPRA should do is initiate an emergency mid-cycle review. The regulator has the legal authority, under Section 101(y) of the Petroleum Act 2019, to adjust its formula parameters. If the landed cost data from March cargoes already reflects war-era pricing, there is no legal or policy reason to wait until April 15 to incorporate it.

An emergency review that reflects actual current landed costs, with a transparent accompanying explanation, would remove the speculative incentive for hoarding and reduce the arbitrage pressure that is driving dealers to consider diverting fuel across borders.

The government’s subsidy pledge needs to be backed by a concrete payment mechanism and timeline, not another vague assurance.

If dealers are expected to absorb temporarily elevated landed costs in exchange for government reimbursement, a ring-fenced payment facility with a defined settlement period, administered through a mechanism independent of the general treasury payment process, is the minimum credible commitment.

The alternative is a repeat of 2022, where small dealers were destroyed by subsidy arrears while large OMCs absorbed the losses and passed them forward.

The hoarding accusation deserves regulatory enforcement, not just a public statement. If EPRA or the Ministry of Energy has evidence that specific OMCs are withholding stocks in anticipation of price increases, the Petroleum Act provides for investigation and sanction.

The Cabinet Secretary has convened emergency meetings. Those meetings should produce legally enforceable undertakings from the major OMCs, not press releases.

The Verdict on UNEPA’s Ultimatum

Is UNEPA’s demand justified? Partially, and on very narrow grounds. The structural complaint about independent dealers being squeezed between regulated retail prices and unregulated wholesale behaviour by dominant OMCs has been a legitimate and documented grievance for years.

The current crisis has intensified that squeeze to breaking point for many small operators.

The claim that the government cannot be trusted to pay subsidy arrears on time is historically accurate.

But the specific demand, suspend price regulation now and let the market set the price, is a different matter entirely. It is a demand that would benefit large OMCs with market power far more than it would benefit the small independent dealers UNEPA claims to represent.

It would immediately raise pump prices for every Kenyan consumer at a moment of maximum economic stress. It would disproportionately harm the rural poor, who have the fewest alternative transport options and the least capacity to absorb inflation. And it is being pressed in a window chosen precisely because the geopolitical crisis makes the government more susceptible to pressure.

The threat to halt supply is, at its core, a negotiating position. It is a demand dressed as a warning. Some of what underlies it is legitimate market distress. Much of it is opportunism, and in the current environment, where matatu fares are already climbing, where North Rift farmers cannot access diesel for planting, and where Nairobi commuters are traversing the city on motorcycles looking for petrol, the opportunism is worth calling out by name.

The Kenyan state, for its part, has no standing to be righteously indignant.

Its failure to build strategic reserves, its refusal to maintain a functioning national refinery, its extension of a G-to-G deal that tied the country’s fuel security to three Gulf suppliers whose refining infrastructure is now under military attack, its tolerance of a wholesale market structure that systematically disadvantages independent dealers, these are the policy failures that made this crisis as dangerous as it is.

EPRA, the Ministry of Energy, the National Treasury, and decades of administrations that treated petroleum infrastructure as a patronage vehicle rather than a strategic asset all bear responsibility for the position Kenya is in today.

Kenya lacks strategic reserves. Its refinery is idle. Its three G-to-G suppliers are under attack. Its OMCs are hoarding. Its dealers are threatening a blackout. The state’s vulnerability is entirely self-inflicted.

What Kenya cannot afford, in the middle of a war-driven supply crisis, is for the downstream petroleum sector to become a theatre of regulatory paralysis and commercial brinkmanship. EPRA must act on its emergency review authority. The government must back its subsidy pledge with a credible payment mechanism.

The large OMCs must be held to their mandatory stock obligations. And UNEPA must understand that the public will remember who chose to manufacture scarcity during a national emergency, regardless of how legitimate the underlying grievance may be.

The pump must flow. That is not a business proposition. It is a public necessity. The regulatory machinery exists to make it so. Whether the people operating that machinery have the courage to use it is now the only question that matters.