Vodacom Steps in to Acquire a Portion of the Kenyan Government's 34.9% Stake in Safaricom

Vodacom Group is currently in talks with the Kenyan government to buy a portion of its 34.9% stake in Safaricom, which is Africa’s biggest listed telecom company. Vodacom already owns nearly 40% of Safaricom and is looking to increase its share by acquiring part of the government’s stake. Although discussions are still ongoing and no final decision has been made, Vodacom expects to be involved once the government officially starts the sale process.

Safaricom holds a dominant position in Kenya, serving about two-thirds of the country’s mobile subscribers and is valued at approximately 1.19 trillion Kenyan shillings (around $8.9 billion), making it one of East Africa’s most valuable companies. The Kenyan government is thinking about selling part of this stake to help raise money. The sale of some shares would provide a big cash boost to the government’s finances, helping it manage rising debt and budget shortfalls without having to hike taxes.

For Vodacom, increasing its stake in Safaricom is a strategic move, especially because of M-Pesa, the continent’s largest and fastest-growing mobile money platform. M-Pesa plays a huge role in East Africa by offering services like payments, loans, and transfers to millions of people. By owning more of Safaricom, Vodacom could expand M-Pesa’s reach and influence how mobile money services develop across Africa.

This isn’t the first time Vodacom has increased its holding in Safaricom. Back in 2017, it boosted its stake through a share swap with its UK parent company, Vodafone. Now, Vodacom’s talks with the Kenyan government show they want to keep a strong hold on Safaricom and its digital financial services.

Kenya’s Treasury Secretary, John Mbadi, mentioned plans to possibly split Safaricom into three units, which could reduce the government’s stake. However, Vodacom has confirmed its commitment to keeping M-Pesa intact, ruling out any plans to spin off the mobile money platform.

Selling part of the government’s stake means the government would have less control over a major national company. The deal would need to go through regulatory checks to make sure it follows ownership and competition rules. Vodacom taking on more shares also means it’ll have to balance the operational and strategic sides of owning a bigger chunk of the company, which may affect the share price, investor confidence, and how quickly Safaricom can expand in the region.

On a wider scale, this potential transaction could set a new example for telecom investments in Africa, particularly around mobile money platforms and digital finance. Everyone will be watching closely to see how this affects telecom ownership and cross-border investments in East Africa.

Vodacom to acquire a portion of the Kenyan government's stake in Safaricom

Vodacom’s interest to acquire a portion of the Kenyan government’s stake in Safaricom is a significant move for both the company and the region, reflecting the growing importance of telecom and mobile money services in Africa’s future.

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