The High Court is expected to make a ruling on Monday on whether the government’s planned sale of a 15 percent stake in Safaricom Plc to parent firm Vodacom Group Limited will proceed.
The South African multinational made the disclosure to investors last week, while noting that it expected a rapid close to the transaction should the court give a favourable ruling.
The transaction was frozen when petitioners Tony Gachoka and Fredrick Ogola sued several State agencies, Safaricom and Vodacom, questioning the legality of the government’s plan to reduce its stake in the telecoms giant.
Two other petitions were filed by Paul Maina and a litigant only identified as Mr Samuel. The two cases were later merged.
The pause on the transaction has delayed the payment of Sh244.5 billion to the National Treasury, including Sh40.2 billion in advanced dividends from what would be the government’s residual 20 percent stake in the Nairobi Securities Exchange-listed firm.
‘We expect an update on this ruling on May 18, 2026. Pending this outcome, we’ll be able to finalize the deal very quickly,’ said Vodacom chief executive officer Shameel Joosub in a May 11 earnings call.
‘This transaction was approved by Parliament and in all necessary regulatory bodies but is subject to a status quo order issued by the High Court of Kenya.’
The High Court referred the petition to Chief Justice Martha Koome at the end of March, with Koome consequently appointing a multi-judge bench to handle the case after the presiding judge stepped aside due to time constraints.
The court case was filed as analysts and politicians debated the merits of the government’s partial divestment from Safaricom, with a major issue being whether the State will get full value from the sale price of Sh34 per share.
Some have reckoned that the deal is good for Kenya while others have been sceptical of the benefits of the transaction, seeing Vodacom as the winner after getting majority control of the profitable telecoms operator.
A joint parliamentary committee had approved the sale, paving way for the conclusion of the transaction before the litigants struck.
Under the deal, the National Treasury is to receive Sh204.3 billion for the 15 percent stake, representing a price of Sh34 per share.
The exchequer is also to receive a Sh40.2 billion dividend top-up, representing a loan backed by what will be Kenya’s remaining 20 percent stake in Safaricom.
The delayed sale which had been expected to close in March 2026 will see the Treasury collect Sh16.1 billion. This represents its share of final dividends from its current 35 percent stake when book closure happens on August 4, if the transaction remains on pause.
Vodacom has insisted that the completion of the stake purchase fully rests in the court decision.
‘If the conservatory orders are not lifted, the court case will continue, and it could take a few more months. So, we are a little bit in the court’s hands, and we will see what the court decides,’ added Mr Joosub.
Concurrent to the purchase of the 15 percent stake from the government, Vodacom is also buying a five percent stake in Safaricom that is held by its parent firm, Vodafone Group, at the same price of Sh34 per share.
Once the twin deals are sealed, Vodacom will raise its ownership in the telecom’s operator to 55 percent, attaining majority control.
Earlier in May, Safaricom raised its per share final dividend to Sh1.15 from Sh0.65 previously after its net profit rose 67 percent to Sh95.6 billion.
The government’s share of dividends from Safaricom for the period to the end of March 2026, including an interim dividend of Sh0.85 per share, is Sh28.04 billion.
Proceeds from the transaction are expected to flow to the National Infrastructure Fund (NIF), a vehicle designed to finance large-scale infrastructure expansion, including roads, railways, energy and water systems.
The Treasury indicated that there was no pressure to rush the deal as the funding is not a pressing budget issue.
‘We are not using this money for budgetary support. Whether it comes, (in this financial year) or doesn’t come, our budget will be implemented in the usual way,’ said John Mbadi, the National Treasury Cabinet Secretary.