Vodacom Group is set to significantly increase its ownership in Safaricom PLC by acquiring part of the stake currently held by the National Treasury, further powering the Group's footprint in the telecoms industry across key East African markets of Kenya and Ethiopia.

In a market update on Thursday, Vodacom announced it has entered into an agreement with the National Treasury to acquire 15 percent stake in Safaricom PLC and an additional 5 percent shareholding from Vodafone at KES34 per share, valuing the entire transaction deal at $2.1 billion (KES271.42 billion).

The transaction, which is subject to requisite approvals from regulatory and governmental authorities in Kenya, Ethiopia and South Africa, is poised to see Vodacom’s stake in Safaricom, which will remain listed on the Nairobi Securities Exchange, increase from the current 35 percent to 55 percent.

According to the National Treasury, the government's partial divestiture from East Africa's most profitable company will generate approximately KES240.5 billion, which will be channeled into President William Ruto's critical infrastructure investment priorities of energy, roads, water, and airports.

In accordance with International Financial Reporting Standards (IFRS), Safaricom’s financial results will now transition from being accounted for on an associate basis to being fully consolidated.

Controlling stake in Safaricom 

“This landmark transaction will mark a pivotal step in Vodacom’s journey to accelerate growth and deepens our impact across Africa,” stated Shameel Joosub, CEO of Vodacom Group. 

He added “Acquiring a controlling stake in Safaricom strengthens our position as a market leader, while at the same time unlocks new opportunities to drive digital and financial inclusion at scale in Kenya and Ethiopia. Safaricom’s outstanding track record and differentiated growth outlook perfectly complement our Vision 2030 ambitions, empowering us to deliver sustainable value for all stakeholders and to connect millions more people for a better future. I look forward to working even closer with the Safaricom team and taking some of the learnings from their success and leveraging it across the Group.”

Commenting on the transaction, Peter Ndegwa, Safaricom CEO, said: “Vodacom has been a trusted partner in Safaricom’s journey from the very beginning, and we welcome their continued commitment and long-term investment in our business. Their confidence in Safaricom is a testament to the strength of our people, our strategy, and the opportunities ahead. We look forward to deepening our collaboration as we continue to scale innovation, expand regionally, and deliver transformative digital and financial services to our customers.”

Safaricom, which is marking 25 years since its establishment in Kenya in early 2000, is widely regarded as one of Africa’s most attractive assets in the continent, blending revenue streams across telecommunications, fintech and technology services in its expansive business model. 

Safaricom's strong financial results

Over the years, the telco has consistently delivered strong financial results, with industry-leading margins and resilient revenue flow coupled with a broad spectrum of social impact activities.

Through its pioneer fintech platform M-Pesa, Safaricom drives high-growth fintech revenue, while expansion opportunities in Ethiopia and a growing suite of cloud, IoT and enterprise services position it for continued growth.

“This transaction is one of the first steps in the President’s stated agenda of innovatively unlocking capital, without increasing taxes or the countries debt burden, to allow additional investment in critical infrastructure to support future growth. Safaricom has been, and continues to be, a key strategic investment for us, as we are retaining a 20 percent stake as well as board representation," noted Treasury Cabinet Secretary John Mbadi.

[email protected]