The Government of Kenya has released nine conditions that Vodacom must commit to before the State proceeds with the planned sale of a 15% Safaricom stake to Vodafone Kenya Limited. The proposed divestment, announced last week, is expected to raise between KES 240.5 billion and KES 244.5 billion, which will be used to capitalise the National Infrastructure Fund and the Sovereign Wealth Fund.
The government insists that the transaction is a shareholder level adjustment. It will not change how Safaricom is run or its relationship with Kenyan consumers, suppliers, or employees. The undertakings are designed to protect the company’s identity, leadership and national impact even as the ownership structure shifts.
The Nine Conditions
The government has secured the following commitments from Vodacom, in its capacity as a shareholder in Safaricom:
1. No employee redundancies
Safaricom will not declare redundancies except in ordinary business operations. This condition protects jobs during and after the share transfer.
2. Continued support for Safaricom Foundation and M Pesa Foundation
Vodacom will support the continued existence and full operation of both foundations. These handle major national programs in health, education and community development.
3. Government consultation before any regional expansion
Safaricom must consult the government before starting any new expansion outside Kenya. Consent is not required, but consultation is mandatory for transparency.
4. Chairman and CEO must always be Kenyan citizens
The top leadership positions will remain Kenyan. This ensures local ownership of strategic decision making.
5. Executive committee remains unchanged
There will be no changes to the executive committee as of the signing date unless the CEO approves. This protects the current management structure.
6. Safaricom brand cannot be altered
There will be no changes to the Safaricom corporate brand. This includes the name, trademarks, logo, colours and general brand identity.
7. No major changes to local suppliers for three years
Safaricom will not significantly change its local supplier relationships for at least three years except in the ordinary course of business.
8. Foundation trustees must be Kenyan and all funds used in Kenya
All trustees of Safaricom’s current and future foundations will be Kenyan citizens. All foundation funds must support projects within Kenya.
9. Government consent required for actions listed above
Any action related to conditions one through six cannot be taken without prior written consent from the government. This gives the Government oversight on all major strategic changes.
The conditions directly address public concerns about whether increased foreign ownership could shift Safaricom’s identity or operations. By ring fencing the brand, leadership, suppliers and social impact initiatives, the government ensures Safaricom remains anchored in Kenya.
Treasury Cabinet Secretary John Mbadi described the divestment as a strategic move to strengthen Safaricom’s ability to invest in the next era of digital infrastructure. These investments include 5G, fibre expansion, fintech services, and potential regional growth.
New Ownership Structure
If approved, Safaricom’s ownership will change to:
- Vodafone Kenya Limited: 55%
- Government of Kenya: 20%
- Retail investors: 25%
The government remains a significant shareholder and will continue to influence key decisions through the outlined conditions.
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Also Read: How Safaricom’s Digital Infrastructure is Helping Kenyan Businesses Build Resilience