Kenya Court suspends $1.9B Safaricom sale to Vodacom

Kenya’s High Court has halted the government’s plan to sell a 15% stake in Safaricom to Vodacom Group, citing constitutional questions and concerns over public participation and data governance.

A three-judge bench issued conservatory orders suspending the transaction, which had been valued at about R31.47 billion ($1.9 billion). The ruling follows petitions filed by Kenyan citizens arguing that the process raised public-interest issues and that the terms of the deal required closer scrutiny.

Court orders suspension pending full hearing

The court directed that the proposed sale not proceed until the matter is fully determined. It said the transaction could not continue while questions about legality and transparency remained unresolved.

“A conservatory order is hereby issued restraining all respondents from proceeding with the intended sale,” the bench ruled, adding that constitutional compliance could not be set aside on grounds of investor expectations.

The judges — Francis Gikonyo, Roselyne Aburili and Tabitha Ouya, said the issues raised in the petitions were substantial enough to warrant judicial review. They also noted that concerns about investor confidence could not override constitutional safeguards.

Valuation dispute and public interest arguments

At the center of the petitions is the price at which the shares were to be sold. Petitioners argued that the proposed R5.54 ($0.33) per share undervalued Safaricom and did not reflect its underlying earnings potential.

They estimated the fair value at between R9.00 ($0.54) and R10.30 ($0.62) per share, significantly higher than the proposed transaction price.

However, Safaricom shares were trading at about Ksh 30.80 ($0.23) on the Nairobi Securities Exchange at the time of the filing, highlighting the gap between market pricing and the valuation claims made by petitioners.

The petitions also argued that the government did not carry out adequate public consultation and that the sale of state-owned assets must meet constitutional requirements on transparency and accountability.

Government plan and funding allocation

The Kenyan government had planned to sell 6 billion Safaricom shares to Vodacom as part of a broader restructuring of its holdings in the telecom operator. Proceeds from the sale were earmarked for a National Infrastructure Fund established under President William Ruto’s administration.

The fund is intended to support road construction, energy projects and water infrastructure across the country.

If completed, the transaction would reduce the state’s stake in Safaricom from 35% to 20%, marking a significant shift in ownership of one of Kenya’s most valuable listed companies.

Vodacom engages regulators after ruling

Vodacom said it had taken note of the court ruling and would continue to engage with regulators and stakeholders as the legal process unfolds. The company said it remained confident in the strategic rationale behind the transaction.

“Our long-term strategic partnership with Safaricom remains firmly intact,” Vodacom Group CEO Shameel Joosub said.

The company added that East Africa remains a key growth market and that Safaricom continues to play a central role in its regional strategy.

Vodacom also noted that it had already incorporated Safaricom’s performance into its latest financial results for the year ended March 31, 2026, which showed net profit of R26.7 billion ($1.6 billion).

Regional telecom stakes remain in focus

Safaricom remains one of East Africa’s largest telecom operators, with more than 42 million subscribers and a dominant position in mobile money through its M-Pesa platform.

Vodacom, a leading pan-African communications and financial services company, which serves more than 220 million customers across Africa, has been expanding its footprint in digital financial services and data-driven products as competition intensifies across the region.

The court’s decision leaves the timing and structure of the proposed transaction uncertain, pending further hearings.