Business

Kenya Seals KSh 244.5 Billion Safaricom Stake Sale to Fund National Development

NAIROBI – In a landmark transaction announced on December 3, the Government of Kenya has concluded the sale of a significant stake in telecommunications giant Safaricom PLC, generating KSh 244.5 billion for the national treasury. The move is a central part of the administration’s strategy to unlock capital from state assets to fund critical infrastructure without raising taxes or accruing new debt.

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Under the deal, the government sold 6.01 billion shares, representing a 15% stake in Safaricom, to Vodafone Kenya for KSh 34 per share. The price represents a 21% premium over Safaricom’s last trading price of KSh 28.20 prior to the announcement. An additional KSh 40.2 billion was received for future dividend rights on the government’s remaining shares.

The transaction reshapes the ownership structure of Kenya’s most profitable company. The government’s direct stake falls from 35% to 20%, while Vodafone Kenya’s shareholding rises from 40% to a controlling 55%. The remaining 25% is held by public investors on the Nairobi Securities Exchange. In a related corporate restructuring, Vodacom Group of South Africa will assume 100% ownership of Vodafone Kenya.

Treasury Cabinet Secretary Njuguna Ndung’u stated the proceeds are earmarked for capital-intensive national projects. “This infusion of liquidity will be channeled into our long-term development pillars, primarily to capitalize the proposed National Infrastructure Fund and the Sovereign Wealth Fund,” he said. “These funds are designated for energy, roads, water, and airport upgrades—investments that build tangible national assets and reduce future borrowing needs.”

The premium sale price has been viewed positively by market analysts, signaling strong investor confidence in Safaricom’s value. However, it has also sparked debate over the government divesting a further portion of a consistently high-performing, dividend-yielding asset.

Public reaction has been mixed, with some commentators applauding the fiscal strategy. “This is exactly the kind of thinking we’ve been asking for,” said financial analyst Cyprian Nyakundi in a social media post. “The government is raising serious money without new taxes and without piling on more debt. It’s a badly-needed revenue boost.”

While the transaction marks a major step in the state’s asset monetization program, observers caution that it does not automatically signal the smooth implementation of the broader privatization agenda for other parastatals. The deal remains subject to final regulatory approvals from relevant authorities in Kenya.

Safaricom will retain its listing on the Nairobi Securities Exchange, and the government has emphasized its retained 20% stake ensures continued strategic influence. The transaction is seen as a test case for leveraging state-owned enterprise value to address national fiscal and development challenges.