Vodacom Expands Reach Across East Africa with Safaricom Deal

Vodacom Group confirms it will increase its stake in Safaricom PLC from 35% to 55% through a US$2.1bn deal. 

The agreement strengthens Vodacom’s presence in Kenya and Ethiopia, aligning with its aim to grow its telecoms and financial services operations in high-growth African markets.

The transaction sees Vodacom acquire 15% of Safaricom from the Government of Kenya and another 5% from Vodafone, both at KES34 per share. 

Once approved by regulators in Kenya, Ethiopia and South Africa, Safaricom will be majority-owned by Vodacom, while remaining listed on the Nairobi Securities Exchange.

After completion, Safaricom’s ownership structure will be Vodacom (55%), the Government of Kenya (20%) and public investors (25%).

Full consolidation under Vodacom’s financials

The deal triggers a change in how Vodacom reports Safaricom’s performance. Under International Financial Reporting Standards (IFRS), Safaricom will shift from an associate to a fully consolidated entity, increasing Vodacom Group’s total revenue towards US$$12.8bn.

Shameel Joosub, Chief Executive Officer of Vodacom Group, says: “This landmark transaction will mark a pivotal step in Vodacom’s journey to accelerate growth and deepens our impact across Africa.

“Acquiring a controlling stake in Safaricom strengthens our position as a market leader, while at the same time unlocks new opportunities to drive digital and financial inclusion at scale in Kenya and Ethiopia. 

“Safaricom’s outstanding track record and differentiated growth outlook perfectly complement our Vision 2030 ambitions, empowering us to deliver sustainable value for all stakeholders and to connect millions more people for a better future. 

“I look forward to working even closer with the Safaricom team and taking some of the learnings from their success and leveraging it across the Group.”

Safaricom operates across telecoms, enterprise, fintech and technology services. 

Its consistent financial performance, strong margins and cash generation provide stability. 

Safaricom also owns a majority share in Safaricom Ethiopia, giving Vodacom exposure to one of the continent’s largest untapped markets.

M-Pesa growth underpins fintech expansion

M-Pesa, co-developed by Vodafone and Safaricom, remains a central part of the business. It handles over 100 million transactions daily and supports 38 million customers in Kenya alone. 

With its mobile-first approach, M-Pesa continues to lead in financial inclusion across the region.

Peter Ndegwa, CEO of Safaricom, says: “Vodacom has been a trusted partner in Safaricom’s journey from the very beginning and we welcome their continued commitment and long-term investment in our business. 

“Their confidence in Safaricom is a testament to the strength of our people, our strategy and the opportunities ahead. 

“We look forward to deepening our collaboration as we continue to scale innovation, expand regionally and deliver transformative digital and financial services to our customers,” says Peter.

The Government of Kenya retains a 20% stake in Safaricom and continues to hold board representation, positioning the company as a long-term national investment.

John Mbadi, Cabinet Secretary for the National Treasury and Economic Planning, says: “This transaction is one of the first steps in the President’s stated agenda of innovatively unlocking capital, without increasing taxes or the countries debt burden, to allow additional investment in critical infrastructure to support future growth. 

“Safaricom has been, and continues to be, a key strategic investment for us, as we are retaining a 20% stake as well as board representation.”

Vodafone and Vodacom realign around African growth

Vodacom acquires the shares through two transactions: €1.36bn (US$$1.58bn) for the 15% held by the Government of Kenya, and €0.45bn (US$524M) for the 5% from Vodafone. The total €1.81bn (US$$2.11) acquisition gives Vodafone and Vodacom joint control over one of Africa’s most valuable telecoms assets.

Margherita Della Valle, Vodafone Group CEO, says: “In line with our focus on growth, this is an opportunity to gain a controlling shareholding in a highly successful African business in an attractive market. 

“We have enjoyed a successful partnership with Safaricom since 2000, including the co-development of M-Pesa, which has brought wide-ranging financial inclusion to millions of customers.”