Safaricom raised its stake in the Ethiopian unit to 54.1 percent at the end of March 2026, following a fresh round of funding which saw the telecoms operator sink Sh21.3 billion ($165 million) in the business over the last year.
The operator’s stake in the business rose steadily in the financial year from 51.67 percent in March 2025.
The Vodacom family including Safaricom Plc and Vodacom Group Limited participated exclusively in the latest fund raising, diluting stakes by minority investors including Sumitomo, British International Investment (BII) and IFC.
Total funding for Safaricom Ethiopia rose to Sh341.7 billion ($2.64 billion) from Sh293.2 billion ($2.27 billion) in the year to March 2026.
Safaricom’s share of cumulative funding for the subsidiary stood at Sh158 billion ($1.22 billion), rising from Sh136.6 billion ($1.05 billion) previously.
The higher stake implies that Safaricom would keep the largest portion of earnings from the business, which is expected to reach profitability in the current cycle.
The telecoms operator noted that the bulk of new funding was channelled to the settlement of vendor arrears.
‘Part of the funding was used to reduce deferred vendor payments by $121 million (Sh15.6 billion). During the first half of the year, Safaricom Ethiopia secured a $100 million (Sh12.9 billion) facility, which was increased at the end of the quarter by $34 million (Sh4.39 billion,’ said Safaricom Plc chief finance officer Dilip Pal.
Vodacom, the second participant in the latest funding round, raised its stake in Safaricom Ethiopia from 5.74 percent to 6.02 percent in the review period.
Shareholding by Sumitomo dropped from 25.23 percent to 23.5 percent on dilution while BII’s stake fell to 9.5 percent from 10 percent.
The International Finance Corporation (IFC) shareholding in the business also fell to 6.81 percent from 7.25 percent previously.
Total funding for the Safaricom Ethiopia business includes Sh109.8 billion ($850 million) and Sh19.3 billion ($150 million) telecoms operator fee and M-Pesa licensing fees.
The operating entity has also borrowed from the local market, in local currency, as part of a balance sheet optimisation strategy.
‘Overall, the business is well funded, leveraging the balance sheet through debt and reduced reliance on equity,’ Mr Pal added.
Safaricom retained its breakeven outlook for the Ethiopia business in March 2027 as losses for the unit fell 35 percent to Sh21.2 billion from Sh36 billion.
‘Ethiopia is gradually transitioning from roll-out to scale. It remains, for now, an investment phase market, but it’s a market with long-term strategic potential,’ said Safaricom Plc board chairman Adil Khawaja.
The unit generated Sh14 billion in service revenues, including Sh9.5 billion from the sale of mobile data, Sh3 billion from voice and Sh169.4 million from M-Pesa.
One-month active customers on the network grew 48.3 percent to 10.75 million.
The performance of the unit benefited from an improved macroeconomic environment and a review of voice and mobile data tariffs in December 2025.
‘We continue to make steady and meaningful progress. The pricing rationalisation, implemented in December last year is already generating positive market momentum,’ added Mr. Khawaja.