Vodafone offloads 35pc stake in Safaricom to Vodacom

Vodafone offloads 35pc stake in Safaricom to Vodacom
Chief Executive of Kenya's telecom operator Safaricom Robert Collymore speaks during a Reuters interview at their headquarters in Nairobi, Kenya, January 27, 2017. REUTERS/Thomas Mukoya

Safaricom is set to have a new majority shareholder following the decision by UK based telecom operator Vodafone to substantially reduce its stake in the company.

In the deal, Vodafone will sell 35 percent of its stake in Safaricom to its South African based subsidiary Vodacom in a deal estimated at $2.6 billion (Sh266 billion).

Vodafone currently owns a 65 percent stake in Vodacom which is set to rise to 70 percent once the deal is concluded.

This will see Vodacom now on equal footing with the Government as shareholders in Safaricom, enabling more Kenyan representation on the board, while Vodafone will retain a five percent stake.

Safaricom chief executive officer Bob Collymore said in a statement the new shareholding arrangement would enable rapid expansion of the company as it seeks new growth areas.

“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,” Mr Collymore said.

The transaction is still subject to regulatory approval in Kenya, South Africa and the United Kingdom.

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