Mbadi: How Kenya Plans to Spend the Ksh244.5B Safaricom Stake Windfall

The government plans to sell a 15% stake in Safaricom to Vodacom Group Limited for Ksh.244.5 billion, the telco has announced.

The stake, equivalent to 6,009,814,200 ordinary shares priced at Ksh.34 each, will reduce the State’s ownership in Safaricom from 35% to 20%.

In addition to acquiring the government’s stake, Vodacom will buy a 5% interest from Vodafone International Holdings, raising its total shareholding in Safaricom from 35% to 55%. This gives Vodacom majority control for the first time since Safaricom’s listing in 2008.

The government share acquisition links to an internal reorganisation where Vodacom will acquire Vodafone International Holdings B.V.’s 12.5 per cent stake in Vodafone Kenya, resulting in Vodacom taking over Vodafone Kenya.

Vodafone Kenya has also agreed to pay the government an upfront payment of approximately Ksh.40.1 billion for the right to receive Ksh.55.7 billion in future Safaricom dividends that would have gone to the government on its remaining stake.

National Treasury CS John Mbadi says the funds will serve as seed capital for the National Infrastructure Fund.

The sale, which requires regulatory approvals from state regulators, the public, and Parliament, will see the government custodian, the National Treasury, lose key decision-making power to Vodacom.

CS Mbadi, who announced the sale on Thursday, insists that the state still has the capacity to influence decisions at the telco through its 20 per cent shareholding.

“The sale of a 15 per cent stake, which represents 6,009,814,200 ordinary shares at Sh34 per share, gives us a premium of 26.5 percent. The Kenyan government still holds a significant 20 per cent to influence decision-making,” Mbadi said.

He added that all national safeguards, including data protection, cybersecurity, critical digital infrastructure, spectrum allocation, and the integrity of national payment systems, remain firmly protected under the Kenyan regulatory environment.

Mbadi said the proceeds will form part of the seed capital for the National Infrastructure Fund and the Sovereign Wealth Fund, helping the government build long-term financial foundations.

“This aligns with the vision articulated by President William Ruto: a Kenya that is less dependent on debt and less reliant on increasing taxes to fund development. It is a good and timely move for our nation,” Mbadi said.

Kenya targets KSh600 billion to fund various infrastructure projects, including roads, dams, and energy infrastructure, as a way of reducing dependency on debt.

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