Safaricom’s British parent company, Vodafone, is set to sell 35 per cent stake in the Kenyan telecom to its South African subsidiary Vodacom in a deal valued at Sh266 billion (€2.4 billion).
Vodafone is currently Safaricom’s largest shareholder with 40 per cent interest. Under the deal, Vodafone will retain five per cent shareholding in Safaricom and cede majority of its stake for a bigger slice of Vodacom, raising its stake in the South African company from 65 per cent to 70 per cent.
The Kenyan government holds a 35 per cent stake in the telco.
The deal is subject to regulatory approval but Vodafone says it has assured the National Treasury, Safaricom’s second largest shareholder, that Kenyan interests in the company will continue to be protected.
“The agreement Vodafone Group has reached with the Government of Kenya will ensure Safaricom continues to have strong Kenyan representation at Board and Management levels,” said Safaricom chief executive, Mr. Bob Collymore, in statement.
Vodafone says that the transaction will streamline its operations in Africa while providing for greater cooperation between Safaricom and Vodacom.
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Credit: Business Daily