Vodacom, through Vodafone Kenya, is set to boost its ownership in Safaricom to 55% after reaching an agreement to purchase an additional 15% stake from the Government of Kenya (GOK). The deal, worth $1.6 billion (KSh 204.3 billion), will give Vodacom majority control of East Africa’s largest telecommunications company.
Safaricom confirmed the development in a statement released on Thursday, noting that it had received a formal notice of intention regarding the Proposed Transaction.
Breakdown of the $1.6 Billion Share Deal
The transaction will see Vodafone Kenya acquire 6,009,814,200 ordinary shares, equivalent to 15% of Safaricom’s issued shares.
According to Safaricom:
“The acquisition price is KES 34.00 per share, valuing the transaction at KES 204.3 billion (approx. USD 1.6 billion).”
Once completed, Safaricom’s ownership structure will shift to:
- Vodacom: 55%
- Government of Kenya: 20%
- Public shareholders: 25%
Safaricom, which controls roughly two-thirds of Kenya’s mobile market, is valued at approximately $8.9 billion (KSh 1.19 trillion), making it one of East Africa’s largest publicly traded companies.
Vodacom to Fully Own Vodafone Kenya
In addition to buying the government stake, Vodacom will acquire Vodafone International Holdings’ 12.5% shareholding in Vodafone Kenya. This move will make Vodacom the sole shareholder of Vodafone Kenya.
Safaricom explained that:
“The GOK Share Acquisition and the Vodafone Kenya Acquisition are inter-conditional shareholder-to-shareholder transactions and are expected to be completed simultaneously.”
Government’s Reason for Selling Its Safaricom Shares
Kenya’s decision to reduce its Safaricom holding comes at a time of rising debt obligations and widening budget deficits.
The sale is expected to generate significant immediate revenue, strengthening the government’s financial position.
As part of the terms, Vodacom will pay the government KSh 40.2 billion upfront, replacing future dividend payouts from the state’s remaining 20% stake.
Vodacom Will Not Launch a Takeover Bid
Despite gaining majority control, Vodacom has made it clear that it does not plan to initiate a full takeover of Safaricom.
“Vodafone Kenya does NOT intend to launch a takeover offer of Safaricom,” the company stated, adding that it will seek an exemption from the Capital Markets Authority (CMA) under regulation 5(1).
This exemption would allow Vodacom to bypass mandatory takeover rules that would typically require an offer for the remaining 45% shareholding.
Regulatory Approvals Still Pending
The proposed transaction is still dependent on approvals from the Capital Markets Authority (CMA) and the Cabinet of Kenya.
If cleared, the acquisition will mark another major milestone in Vodacom’s long-term investment strategy. Vodacom previously increased its shareholding in Safaricom in 2017 through a share swap with its parent company, Vodafone.
