South Africa’s Vodacom Group will retain its 55% controlling stake in Safaricom as a legal appeal proceeds over its acquisition of the Kenyan government’s 15% shareholding in the telecommunications company.
The Court of Appeal in Nairobi has directed that the existing position be maintained pending the substantive appeal, leaving Vodafone Kenya Limited, Vodacom’s subsidiary, as the registered holder of the disputed shares for now.
The dispute follows a September 15, 2026, High Court judgment that declared the government’s sale of 6.01 billion Safaricom shares, valued at KSh204.3 billion, unconstitutional and invalid.
The three-judge bench ruled that the transaction lacked adequate public disclosure and that material information about the deal’s implications for ownership and control had not been properly presented.
The acquisition was completed on June 30, 2026, when Vodacom acquired the government’s 15% stake and an additional effective 5% interest from Vodafone Group.
The combined purchases increased Vodacom’s ownership from 35% to 55%, giving the South African telecommunications group majority control of Safaricom, which is listed on the Nairobi Securities Exchange.
The High Court found that the government had presented the transaction as a partial divestiture, despite its effect of transferring control of the company to a foreign investor.
It also raised concerns about transparency, public participation and national security, citing Safaricom’s role in mobile money, government payment systems, election transmission infrastructure and the handling of personal data.
Following the ruling, Vodacom and the Kenyan government sought orders to suspend its implementation while they challenged the judgment.
On October 13, the Court of Appeal declined to determine the stay application separately and instead directed that the substantive appeal be fast-tracked. Vodacom subsequently said the existing position regarding the shares and purchase consideration would remain in place pending the appeal.
The outcome could have significant financial implications for the government, which received KSh204.3 billion from the sale, as well as for Vodacom’s regional expansion strategy.
The transaction also included a payment of about KSh40.17 billion in lieu of future dividends on the government’s retained shareholding.
If the High Court ruling ultimately stands, the government’s 15% stake would have to be restored under the judgment, potentially requiring steps to unwind the transaction.
For Safaricom, the dispute leaves questions about its ownership structure and long-term corporate governance unresolved.
Investors will be watching the appeal closely, as the final decision will determine whether Vodacom retains majority control or its stake is reduced if the disputed government shares are returned.
