Vodacom announced the acquisition of an additional 20% stake in Safaricom, raising its holding from 35% to 55% and establishing control of the Kenyan operator for the first time since its original investment in 2017.
The group agreed to pay KES 34 per share for 8 billion Safaricom shares, a transaction valued at approximately R36 billion. The implied EV/EBITDA multiple for the controlling 20% stake stands at 6.9 times FY26 earnings.
CEO Shameel Joosub said: “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.”
From Associate to Subsidiary
The transaction converts Safaricom from an associate investment into a consolidated subsidiary on Vodacom’s balance sheet. Vodacom’s existing 35% stake has delivered a total return of more than 100% since acquisition.
The deal will push group net debt toward Vodacom’s management threshold of 1.5 times EBITDA. The group expects earnings to move from neutral to accretive within three to five years, pending purchase price allocation.
What Vodacom Is Buying
Safaricom reported EBITDA growth of 27.9% in local currency terms for FY26. Net income attributable to equity shareholders grew 37%, and the dividend per share rose from KES 1.40 to KES 2.00 — the first increase since Safaricom began investing in Ethiopia.
M-PESA now contributes 44.1% of Safaricom’s service revenue in Kenya, up from 43.2% the prior year. Across the group including Ethiopia, Safaricom processed the equivalent of US$1.4 billion in mobile money transactions per day during FY26.
Ethiopia grew its customer base 54.2% year on year to 13.6 million subscribers. EBITDA losses narrowed 54.4% in shilling terms, and Safaricom’s FY27 guidance projects group EBIT of between KES 180 billion and KES 187 billion.
Strategic Rationale
Vodacom cited four reasons for the deal: Safaricom’s market leadership in Kenya with a return on capital employed above 50%; M-Pesa’s growth trajectory supported by lending, savings and merchant services; Safaricom’s infrastructure portfolio across fibre, towers and spectrum; and the social impact of expanding digital and financial access in Kenya and Ethiopia.
The acquisition supports Vodacom’s Vision 2030 targets, which the group upgraded following the announcement. The customer target moves to 275 million. The financial services customer target rises to 130 million. Beyond-mobile services — currently 22.3% of group service revenue — carry a Vision 2030 target of 30%.
