Kenya to sell 15% Safaricom stake to Vodacom
Kenya will sell a 15% stake in Safaricom to South Africa’s Vodacom for $1.6 billion, the government and the companies announced on Thursday, as Nairobi accelerates asset sales to ease heavy public debt.
Safaricom, Kenya’s largest company by market value, will see Vodacom’s ownership increase from 39.9% to 55%, giving it effective control of the telecommunications giant, best known for its M-Pesa mobile money platform, News.Az reports, citing Reuters.
Finance Minister John Mbadi said the state will use proceeds from the sale to establish a national infrastructure fund and a sovereign wealth fund, enabling investment in roads, irrigation, energy projects, and the country’s main airport without adding to public debt.
“We are converting one asset into another,” Mbadi said, noting that Kenya faces high annual debt repayments consuming 40% of government revenue.
Vodacom will pay 34 shillings per share, a 23.6% premium over Safaricom’s six-month weighted average price. The deal still requires approval from parliament and regulators.
Safaricom shares jumped more than 4%, while Vodacom slipped over 2% after the announcement.
Despite its stake dropping from 35% to 20%, the Kenyan government will retain influence over Safaricom’s strategic direction. Vodacom will also be required to preserve Safaricom’s workforce, identity, and branding.
The South African operator says it will not launch a takeover offer after gaining control and will seek regulatory exemptions tied to its increased shareholding.
Vodacom said the deal will deepen its presence across Africa, including in Ethiopia, where Safaricom began operations in 2022, and in markets such as the DR Congo and Tanzania.
Vodacom will also buy rights to future dividends on the government’s remaining shares, paying Nairobi an upfront 40.2 billion shillings.
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