Vodacom to Acquire Majority Stake in Safaricom in $2.1 Billion Deal

Prime Highlight:

Vodacom will increase its ownership in Safaricom to 54.9% by acquiring stakes from the Kenyan government and Vodafone.

The deal aims to strengthen Vodacom’s mobile payments, digital wallets, lending, and financial inclusion services across East Africa.

Key Facts:

Safaricom, valued at around $8.8 billion, controls roughly 60% of Kenya’s mobile subscribers and reported $1.4 billion in revenue in H1.

Vodacom’s $2.1 billion acquisition requires multiple regulatory approvals, including from Kenyan authorities and regional competition bodies.

Background

South Africa’s leading mobile operator, Vodacom Group, has announced a major deal to take control of East Africa’s largest telecom provider, Safaricom Plc. Under the agreement, Vodacom will increase its ownership to 54.9 percent after acquiring a 15% stake from the Kenyan government and an effective 5% from Vodafone International Holdings.

The deal, valued at about $2.1 billion, also includes a 5.3 billion rand payment (roughly $310 million) to secure future dividend rights previously belonging to the Kenyan government.

Vodacom said the move will boost its capacity in mobile payments, digital wallets, lending, and financial inclusion services across the region. Safaricom, which serves a majority of Kenya’s mobile users, holds a dominant position in the telecom market and maintains a strong record of financial growth. The company is valued at about KES 1.196 trillion, around $8.8 billion, and it controls roughly 60 percent of mobile subscribers in Kenya. In the six months to September, Safaricom’s revenue rose 11.1 percent to KES 199.9 billion ($1.4 billion).

To fund the acquisition, Vodacom plans to use loan arrangements involving Vodafone and a Kenyan-shilling credit facility guaranteed by Vodacom. The deal brings together South and East African telecom markets under a single large regional player.

The company must get approval from several regulatory bodies before the acquisition can go ahead. They will ask for approval from the Kenyan Cabinet, National Assembly, Capital Markets Authority, Communications Authority, Central Bank, COMESA Competition Commission, and East African Community Competition Authority. Meanwhile, Safaricom has urged investors and shareholders to exercise caution in trading its shares until all approvals are complete.

If the deal clears regulatory hurdles, it could reshape East Africa’s telecom landscape. Vodacom expects that increasing its stake will help it grow digital services and improve financial inclusion. For Safaricom, the partnership gives it more funding and a wider regional reach under Vodacom’s leadership.