Kenya’s High Court has nullified the government’s sale of a 15% stake in Safaricom to Vodacom Group. A three judge bench ordered the shares returned to the state, unwinding a transaction that closed on 30 June.
Justices Francis Gikonyo, Roselyne Aburili and Tabitha Ouya delivered the ruling on 15 September at the Constitutional and Human Rights Division. The bench found that the government withheld information from the Cabinet, Parliament and the public, then misrepresented the structure of the deal. What the state called a partial divestment, the court said, worked as a takeover.
“A declaration is hereby made that the partial divestiture…was a camouflage merger”, the bench ruled, and held the arrangement to breach the Constitution.
How the Deal Reached Court
The sale traces back to 4 December 2025, when the government announced plans to sell its 15% Safaricom stake to Vodacom for KES 204.3 billion, at KES 34 a share. Khusoko reported that the price carried a premium of 15.5% over the KES 29.45 Safaricom traded at on announcement day, and that the deal also folded in Vodacom’s separate purchase of Vodafone International Holdings’ remaining 12.5% stake in Vodafone Kenya, lifting Vodacom’s effective Safaricom holding from 35% to 55%. Parliament approved the transaction in March 2026.
Activists Tony Gachoka and Fredrick Ogola petitioned the High Court soon after, arguing the price undervalued Safaricom and that the sale bypassed the public participation the Constitution requires before disposal of a state asset. The High Court froze the deal on 18 May. The Court of Appeal lifted that freeze on 26 June, ruling the government’s case was arguable. The sale closed four days later, on 30 June, with Vodafone Kenya acquiring just over 6 billion shares through a block trade on the Nairobi Securities Exchange.
What the Court Found
The bench identified three failures. It found the government skipped adequate public participation before disposing of a national asset. It found transaction documents and structural details were kept from the Cabinet. And it found the state gave unclear or shifting accounts of the buyer’s identity and the deal’s structure, which stopped the Cabinet from evaluating it on merit (business.co.ke).
The court treated the divestiture as a policy decision covered by articles 10 and 201 of the Constitution, provisions that set out public participation and transparency requirements for decisions involving public resources. On that basis, the judges declared the sale automatically void, without need for a separate order to set it aside.
Shares Return to State Ownership
The ruling restores the government’s Safaricom shareholding to 35%, reversing the position Vodacom held since June. The bench ordered that the 15% stake be “restored to the ownership of the Government of Kenya”, held on behalf of Kenyan citizens.
The reversal reaches beyond the shareholding register. Safaricom’s board had ratified governance changes tied to Vodacom’s enlarged stake, and Vodacom had begun consolidating Safaricom into its financial statements under the increase.
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Case Timeline
| Date | Event |
|---|---|
| 4 December 2025 | Government announces plan to sell 15% Safaricom stake to Vodacom for KES 204.3 billion |
| March 2026 | Parliament approves the transaction |
| 18 May 2026 | High Court issues conservatory orders freezing the sale |
| 26 June 2026 | Court of Appeal lifts the freeze, calls government’s case arguable |
| 30 June 2026 | Deal closes; Vodacom’s effective stake rises to 55% |
| 15 September 2026 | High Court declares the sale unconstitutional, null and void |
The Money Involved
Beyond the KES 204.3 billion sale price, Treasury booked a further KES 40.2 billion as an advance on dividends from the 20% stake it retained, taking total proceeds to KES 244.5 billion. Treasury had earmarked the funds for the National Infrastructure Fund and the Sovereign Wealth Fund, part of a plan to fund roads, railways and power projects without new borrowing or new taxes.
Safaricom remains Kenya’s most valuable listed company. It posted net income of KES 100 billion and a dividend of KES 80 billion for the 2026 financial year, according to Khusoko’s review of the company’s results. That scale explains why the 15% stake drew a court challenge in the first place.
What Happens Next
Vodacom has said it will appeal, according to Business Day, which put the value of the reversed transaction at $2.1 billion. Until an appellate court rules otherwise, the High Court judgment stands, and the 15% stake reverts to the government on paper.
What that means for Safaricom’s shareholder register, its board and Vodacom’s consolidated accounts depends on how fast the state and Vodacom act, and on whether the Court of Appeal grants a stay while the case returns for a second round.
