Legal Challenge Filed to Halt Sale of Government Shares in Safaricom

By benadeta mwaura - Reporter

Kenya, January 27 2026 - A group of activists has filed a High Court petition seeking to block the Government of Kenya from selling 15 % of its shares in Safaricom PLC, a move that has ignited debates about national sovereignty, transparency, and the strategic importance of the telecom giant to the economy.

The urgent application was lodged by Tony Gachoka and Prof. Fredrick Ogolla, who argue that the planned divestiture threatens national security, data sovereignty, and the public interest if allowed to proceed without proper scrutiny.

Under the proposed transaction, the government would reduce its stake in Safaricom from 35 % to 20 %, selling approximately 6 billion shares at about KSh 34 per share in a deal valued at around KSh 204.3 billion with Vodacom Group as the strategic buyer.

The petitioners contend that the shares are being sold at a price well below their intrinsic value, estimated by some at KSh 70–80 per share, potentially exposing Kenyan taxpayers to losses estimated at more than KSh 250 billion.

At the heart of the petition are constitutional and procedural objections. Gachoka and Ogolla argue that the divestiture has been conducted in an “opaque, rushed and non-competitive” manner without meaningful public participation, which they say is required under the Constitution and public asset disposal laws.

They maintain that the transaction may contravene the Public Procurement and Asset Disposal Act, 2015, and the Privatisation Act, 2025, and that the Public Private Partnerships Act, under which the government seeks to justify the sale, cannot override constitutional principles of transparency, accountability, and good governance.

The petitioners have asked the court to issue conservatory orders restraining the government and other respondents from selling, transferring, or otherwise alienating the shares until the petition is fully heard and determined. They have also sought full disclosure of valuations, approvals, advisory reports, and all legal agreements tied to the transaction.

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Critics of the sale have argued that Safaricom dominates Kenya’s telecoms, mobile money, e- commerce, and digital financial services sectors, making it a strategic asset with implications for competition policy, data infrastructure, and national security.

The petition warns that transferring majority control to a foreign entity, as Vodacom Group’s stake would rise to 55 %, risks undermining sovereign oversight of critical systems used by millions of Kenyans. The legal challenge comes amidst broader scrutiny of the proposed sale.

The Consumer Federation of Kenya (COFEK) has petitioned Parliament to halt the divestiture, arguing it undermines economic sovereignty and that the transaction’s structure, limited to a single strategic investor, fails to offer Kenyan retail investors a fair chance to deepen their ownership in the company.

Lawmakers such as Ndindi Nyoro, MP for Kiharu, have also criticised the process, suggesting that opening the sale to competitive international bidding could unlock significantly higher value for taxpayers. On the other side, Treasury Cabinet Secretary John Mbadi and government representatives have defended the sale as a strategic move to unlock value from a mature state investment and to generate substantial foreign exchange inflows, which could help strengthen Kenya’s finances without expanding public debt.

Safaricom’s CEO Peter Ndegwa has also reiterated that the transaction will not alter the company’s regulatory obligations or operational framework under Kenyan law. As the matter unfolds in court, the challenge highlights the tension between fiscal strategy and public trust, setting the stage for a high-stakes legal and political battle over one of Kenya’s most valuable publicly held companies.

Safaricom’s central role in the economy, spanning communications, digital payments, and financial services, means the outcome could have far-reaching implications for investor confidence, regulatory policy, and how the country manages strategic assets in the digital age.