Kenya’s Court of Appeal will fast-track proceedings over a $1.9 billion deal that would increase South African telecommunications group Vodacom’s stake in Safaricom, the country’s largest mobile operator. The move could accelerate a legal battle over one of Kenya’s biggest privatization transactions and the government’s handling of the sale.

Vodacom said Friday that the court decided on Oct. 13 to fast-track the substantive appeal rather than rule on an application before it. The company added that the existing position regarding the shares and purchase consideration would remain unchanged until the appeal is heard, leaving the transaction’s legal status unresolved.

The stakes behind the sale

Vodacom agreed in December to acquire an additional 15% stake in Safaricom, increasing its ownership to about 55% from nearly 40%. The transaction has since faced a legal challenge over the government’s approval process, disclosure of key documents and the valuation used to determine the shares’ sale price.

On Sept. 15, Kenya’s High Court ordered the 15% stake transferred to Vodacom to be returned to the National Treasury. The share sale raised about Ksh 204.3 billion Kenyan ($1.6 billion), while a further Ksh 40.2 billion ($309.6 million) came from the securitization of future dividends.

Court questions deal process

The High Court ruled that the transaction violated Kenya’s Constitution, citing the failure to make critical documents available for public scrutiny and the absence of a sufficient basis for valuing the shares. The ruling cast uncertainty over a transaction central to the government’s efforts to raise funds through the sale of state assets.

Vodacom, majority-owned by Vodafone Group, provides telecommunications and financial services to more than 230 million customers across Africa. The company has expanded its digital financial services and data businesses as operators compete for customers and seek new sources of revenue across the continent.

Safaricom’s broader reach

Founded in 1997 and headquartered in Nairobi, Safaricom dominates Kenya’s telecommunications market, with operations spanning mobile voice and data, fixed connectivity, fiber, cloud services and financial technology. Its M-Pesa mobile money platform is its largest business, making the company a major player in Kenya’s digital payments market.