Vodacom to Appeal Kenya Ruling Against $1.6 Billion Safaricom Stake Purchase

Vodacom Is Fighting to Keep Its 55% Safaricom Stake.

Vodacom is going back to court to defend its controlling stake in Safaricom after Kenya's High Court ordered the cancellation of its Sh204 billion purchase of an additional 15% of the telecoms company from the government. The South African group said it will appeal the September 15th judgment at the Court of Appeal and has also asked the High Court to suspend enforcement of the ruling while the appeal is heard. The government, which sold the shares in the first place, is appealing too.

The legal fight comes just months after the deal was completed. Vodacom paid the government KSh204.3 billion for the 15% stake, while a separate transaction with Vodafone gave it another effective 5% interest in Safaricom. Together, the purchases took Vodacom's effective holding to 55%, giving it control of Kenya's largest telecoms operator. The transaction closed on June 30th, meaning the ownership structure the court has now challenged was already in place before the judgment arrived.

The High Court did not simply question the price paid for the shares. A three-judge bench found that the government had failed to meet constitutional and statutory requirements around public participation and had withheld material information during the sale process. The judges also raised concerns about the implications of transferring effective control of a strategically important telecommunications company to a foreign investor, and ultimately ordered the 15% stake to be returned to the State.

The court's decision therefore reaches into the way Kenya sells public assets, rather than just the terms of one Safaricom transaction. The government had presented the sale as part of its broader programme to raise money from State assets, with the Sh204.3 billion proceeds adding to efforts to manage the country's fiscal pressures. But because Safaricom is a strategic national company, the judges found that the government had obligations beyond simply finding a buyer and agreeing on a price.

Vodacom's purchase was announced in December 2025 and completed six months later. Before the transaction, the Kenyan government held 35% of Safaricom while Vodacom had an effective 40% interest. After the deal, those positions changed to 20% and 55% respectively, with the remaining 25% held by other shareholders through the Nairobi Securities Exchange. Vodacom also said the increased stake would allow it to consolidate Safaricom's financial results, making the transaction materially different from a passive investment.

The High Court has ordered the 15% stake acquired from the government to be restored, while Vodacom is asking the Court of Appeal to overturn that decision and allow the transaction to stand. Safaricom, meanwhile, has said it is reviewing the judgment and assessing what it means for the company as the legal process continues.

For now, the ownership question remains open. Vodacom has its 55% stake, but the court has ordered the government's 15% portion returned, and both sides are appealing. What began as a multibillion-shilling government asset sale is therefore heading into another round of litigation, with the eventual outcome set to determine whether Vodacom's expanded control of Safaricom survives.