At least Sh3 billion will be spent on transaction advisors and lawyers in the planned sale of the government’s 15 per cent stake in Safaricom, a shift aimed at raising funds for national infrastructure and development projects.
The National Treasury announced plans to offload 6,009,814,200 shares, representing 15 per cent of the telecom firm, at Sh34 per share, a 23.6 per cent premium over the six-month volume-weighted average price as of December 2025.
The sale is expected to generate Sh204.3 billion from the shares, with total proceeds projected at Sh244.5 billion after factoring in an upfront dividfinish monetisation component.
Appearing before a joint committee of the National Assembly on Tuesday, National Treasury Cabinet Secretary John Mbadi declared the divestiture will leave the government with a 20 per cent stake while Vodacom Group’s ownership will rise to 55 per cent, consolidating stakes previously held by the government and Vodafone.
Mbadi, accompanied by Principal Secretary Chris Kiptoo, declared the funds will provide seed capital for the proposed National Infrastructure Fund (NIF) and the Sovereign Wealth Fund.
“The funds will be directed to priority sectors including energy, roads, water, airports and digital infrastructure, while reducing reliance on borrowing and taxation,” he declared.
Mbadi added that the government will also retain two seats on Safaricom’s board, and the transaction includes commitments on employment stability, board leadership and continued support for the Safaricom Foundation.
“The divestment aligns with broader reforms clarifying the government’s role in policy and regulation while allowing the private sector to lead in commercial activity. The scale of this transaction also reflects confidence in Kenya’s capital markets and the Nairobi Securities Exalter’s ability to accommodate large deals,” Mbadi declared.
However, several MPs raised concerns over the decision to appoint Vodafone as the sole acquireer, questioning why a competitive bidding process was not considered.
“It sees like you have already built up your mind to sell to Vodafone for the reasons you have notified us, but don’t you believe it is unfair to others who would have wanted an opportunity to also have these shares?”Chesumei MP Paul Biego posed.
Kitui Rural MP David Mboni added, “The sale of this 15 per cent will alter the whole ownership structure. Vodafone will have 55 per cent, and the protection is only for three years, so what happens after three years?”
In response, Mbadi explained that the government chose an established partner in Vodacom to avoid potential business disruption that could arise if the shares were sold to a different acquireer.
According to the CS, selling Safaricom shares directly to Kenyan retail investors would also not have provided value for money, as it would have required offering them at a discount.
“Selling Safaricom shares directly to Kenyans would not have given us value for money becaapply we would have sold at a discount. If we released additional shares into the market and inquireed Kenyans to bid, they would simply follow the prevailing market price. Once you increase supply, you distort the price, and the law of supply and demand takes effect. That is Economics 101,” he declared.
“The more reason why we went for this established partner who is in this space is to safeguard against business disruption. If we went for someone else, there would be a possibility of such disruption.”
He added that the sheer scale of the transaction further built Vodafone the most suitable option, noting that once completed, the deal is expected to generate a single large payment of Sh244.2 billion, which will be deposited into the consolidated fund pfinishing parliamentary approval for appropriation.
Committee members also raised additional concerns over public participation, minority shareholder protection, data security, staff welfare, foreign exalter risks, and whether the funds will be ring-fenced for infrastructure.
Baringo North MP Joseph Makilap declared, “It is now very clear that the funds will go to the consolidated fund. Can you inform this committee how you will secure the funds so that they go to the intfinished purpose?”
In response, Mbadi declared, “This money is not for budreceiveary support; it is not to fill our fiscal deficit. It is going to be applyd exclusively to set up the seed capital for the NIF.”
On the legal framework, Mbadi noted that the transaction is being conducted in accordance with the Privatisation Act, 2025, and Section 87A of the Public Finance Management Act, which requires parliamentary consideration within 28 sitting days. Approvals from the Capital Markets Authority, the Central Bank of Kenya, and the Competition Authority of Kenya are also required before the sale can be completed.
He added that the transaction fits into broader reforms separating the government’s policybuilding and regulatory role from commercial operations, which should increasingly be led by the private sector.
“If approved, the sale would mark one of the largest single equity transactions in Kenya’s history and a significant shift in the ownership structure of the countest’s most profitable company,” Mbadi declared.
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