By Benadeta Mwaura - Reporter
Kenya, July 01, 2026 - Safaricom has entered a new chapter following the completion of the Kenyan government's sale of its 15 percent stake to Vodacom Group, a move that significantly changes the ownership structure of East Africa's largest telecommunications company.
The transaction, valued at approximately KSh204 billion ($1.6 billion), not only raises substantial revenue for the government but also gives Vodacom majority control of one of Kenya's most profitable and strategically important firms.
The deal was completed on June 30, 2026, after receiving the necessary regulatory approvals. According to reports, Vodacom increased its stake from 35% to 55%, while the Kenyan government's ownership declined from 35% to 20%.
Public investors on the Nairobi Securities Exchange now collectively own the remaining 25% of the company. This marks the first time since Safaricom was established in 1997 that a single shareholder has held outright majority control.
The new ownership structure fundamentally changes the balance of power within the company. With a 55% stake, Vodacom now has effective control over Safaricom's strategic direction and corporate governance.
In corporate law, majority ownership allows a shareholder to influence most ordinary resolutions passed at shareholder meetings.
This means Vodacom will have the strongest voice in appointing board members, approving annual financial statements, determining dividend policies, appointing senior executives and shaping long-term investment strategies.
Decisions involving network expansion, regional growth, technology investments, digital services and the future direction of M-Pesa will largely be driven by the majority shareholder.
However, majority ownership does not give Vodacom unlimited authority. Safaricom remains a publicly listed company on the Nairobi Securities Exchange and is still governed by Kenya's Companies Act, Capital Markets Authority regulations, NSE listing rules and the Communications Authority of Kenya.
Major corporate actions, particularly those requiring special resolutions such as constitutional amendments, mergers or significant restructuring, still require broader shareholder approval beyond a simple majority.
Although the government's shareholding has reduced to 20% , it remains Safaricom's second-largest shareholder and continues to wield significant influence.
Beyond its equity stake, the government also regulates the telecommunications sector through agencies such as the Communications Authority of Kenya and oversees the financial services ecosystem through the Central Bank of Kenya, particularly because M-Pesa has become a critical part of the country's payment infrastructure.
This dual role means the government will continue participating in key shareholder decisions, appointing directors to the board and receiving dividends from one of Kenya's most profitable companies.
While the government has surrendered majority ownership, it still retains strategic influence due to its regulatory mandate and national interest in Safaricom's operations.
Beyond the three principal shareholders, Safaricom's ownership is spread across a diverse group of institutional investors that collectively hold the remaining 25% of the company's shares.
Most of these investors hold their shares through nominee accounts managed by commercial banks and investment custodians, reflecting the strong participation of pension funds, insurance firms, asset managers, collective investment schemes and foreign institutional investors.
Among the largest institutional shareholders is Standard Chartered Kenya Nominees Limited (Account KE004667) with 380.66 million shares, making it the largest nominee shareholder outside the three main owners.
It is closely followed by Kenya Commercial Bank (KCB) Nominees Limited, whose Account 1019D holds 365.23 million shares, while another KCB Nominees account (915B) owns 345.58 million shares.
Stanbic Nominees Limited also features prominently among Safaricom's leading institutional investors. Its Account NR7522171 holds 245.60 million shares, while Account NR1030824 owns 224.51 million shares. Another Stanbic nominee account, R6631578, controls an additional 188.16 million shares, highlighting the bank's significant role as a custodian for institutional and foreign investors.
Meanwhile, Standard Chartered Nominees, maintains two other sizeable holdings. Account KE11401 owns 201.93 million shares, while Account KE11443 controls 163.46 million shares, further underscoring the bank's importance in managing investments on behalf of pension funds, fund managers and high-net-worth investors.
Although nominee companies appear as shareholders on Safaricom's register, they do not own the shares themselves.
Instead, they act as custodians, holding the securities on behalf of the actual beneficial owners. This arrangement allows institutional investors to trade and manage their investments efficiently while maintaining secure custody of their assets.
Voting rights attached to these shares are ultimately exercised according to the instructions of the underlying investors.
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Although no single public investor controls a significant stake, together they represent a sizeable voting bloc capable of influencing governance decisions, particularly during Annual General Meetings.
They continue to vote on issues such as the election of directors, approval of dividends, appointment of auditors and broader corporate governance matters. Institutional investors, especially pension funds, are expected to remain vocal in demanding transparency, accountability and prudent management.
From a decision-making perspective, Vodacom clearly emerges as the most influential shareholder under the new structure. Its majority stake allows it to steer the company's overall strategy and make key commercial decisions.
The government remains highly influential because of its shareholding and regulatory oversight, while public shareholders continue to serve as an important accountability mechanism through shareholder voting and market oversight.
This creates a governance framework where Vodacom leads the business commercially, but major strategic decisions are still subject to legal, regulatory and shareholder scrutiny.
One area attracting significant public interest is the future of M-Pesa, Safaricom's flagship mobile money platform.
Despite the ownership changes, customers are unlikely to notice any immediate differences. M-Pesa will continue operating under Safaricom and will remain regulated by the Central Bank of Kenya.
Existing management structures are also expected to remain intact. What may change over time is the pace of expansion.
Vodacom's stronger control could accelerate regional integration of M-Pesa across its African markets, supporting faster rollout of cross-border payments, digital lending products, artificial intelligence services and other financial technologies.
The government has defended the sale as part of its broader fiscal strategy aimed at raising development financing without increasing public debt.
Treasury officials say proceeds from the transaction will help establish a national infrastructure investment fund to finance roads, energy projects, water systems and other strategic developments.
By selling part of its stake rather than borrowing externally, the government hopes to reduce pressure on public debt while unlocking capital for economic growth.
Not everyone agrees with the strategy. Some economists and market analysts argue that Safaricom has consistently delivered strong dividends to the government over the years and question whether reducing the state's ownership could lower future dividend income.
Others counter that the immediate capital injection may generate greater long-term economic benefits if invested effectively in productive infrastructure.
For Safaricom's more than 50 million customers, there should be no immediate impact on mobile services, data packages or M-Pesa transactions.
Company operations are expected to continue normally, with the existing executive management overseeing day-to-day business.
Industry analysts believe customers could eventually benefit from increased investment in fifth-generation (5G) technology, cloud computing, artificial intelligence, cybersecurity and digital financial services as Vodacom integrates Safaricom more closely into its broader African operations.
The ownership restructuring represents one of the most significant corporate changes in Kenya since Safaricom listed on the Nairobi Securities Exchange in 2008. While Vodacom now holds the controlling stake and gains greater authority over the company's strategic decisions, Safaricom remains a Kenyan-listed public company operating under local laws and regulatory oversight.
The new shareholding structure is therefore expected to balance majority shareholder control with government regulation, public shareholder participation and strong corporate governance, ensuring that one of Kenya's most valuable companies continues to operate within the country's legal and economic framework.