By Benadeta Mwaura - Reporter
South Africa, May 11, 2026 - Vodacom’s strong financial performance across Africa is colliding with a critical moment in Kenya’s telecom landscape, as delays in the planned Safaricom stake sale reshape both investor expectations and government earnings.
The South African telecom giant reported a 22.9 percent jump in full-year profit, driven largely by expansion across African markets, reinforcing its strategy of deepening its footprint beyond its home base.
This growth has been powered by rising demand for mobile data, fintech services and a rapidly expanding customer base that now stretches across key markets including East Africa.
At the centre of that expansion strategy lies Safaricom, Kenya’s most profitable company and a cornerstone of Vodacom’s long-term ambitions on the continent.
The planned acquisition of an additional 15 percent stake from the Kenyan government, part of a wider deal that would lift Vodacom’s ownership to a controlling 55 percent, has been seen as a strategic move to consolidate its position in one of Africa’s most lucrative telecom markets.
However, that strategy has hit a temporary pause.
Delays in closing the transaction, triggered by ongoing court cases challenging the legality of the sale, are now set to hand the Kenyan government an unexpected Sh16.1 billion windfall in dividends.
The State is expected to retain its full 35 percent stake longer than anticipated, meaning it will remain eligible for Safaricom’s final dividend payout for the current financial year.
The timing is significant. Safaricom recently posted strong earnings, enabling it to declare a total dividend payout of over Sh80 billion, underlining its status as a cash-generating powerhouse.
What would have gone to Vodacom as part of the acquisition will now, at least temporarily, boost Kenya’s Treasury at a time when the government is under pressure to raise revenue and manage public debt.
More from Kenya
This creates a paradox. On one hand, Vodacom is demonstrating robust growth and positioning itself as a dominant telecom player across Africa. On the other, its attempt to tighten control over Safaricom, arguably its most strategic asset in East Africa, is being slowed down, delaying the full realisation of that growth strategy.
The relationship between Vodacom and Safaricom has always been central to the region’s telecom evolution.
Safaricom, partly owned by Vodacom and the UK’s Vodafone, has grown into a regional giant, driven by innovations like M-Pesa and expansion into markets such as Ethiopia.
For Vodacom, increasing its stake is not just about ownership, it is about gaining greater influence over a business that anchors its East African operations and future digital ambitions.
Analysts remain divided on the deal. Some see it as a necessary step that will bring “greater scale, deeper expertise and enhanced regional capability,” as Safaricom’s leadership has previously indicated. Others argue that it risks handing too much control of a highly profitable national asset to a foreign entity.
In the short term, the delay has turned into a financial advantage for Kenya. In the long term, however, it raises broader questions about the balance between attracting foreign investment and retaining strategic control over key sectors.
What is clear is that the stakes go far beyond a single transaction. Vodacom’s profit surge signals confidence in Africa’s telecom future, while the Safaricom deal delay highlights the political, legal and economic complexities that continue to shape that future.
Together, they paint a picture of a sector in transition, where growth is undeniable, but control, timing and national interest remain just as critical as profit.