Safaricom IPO faces further challenge

25 Sep 2007

Three opposition members of Kenya’s parliament are suing the government for failing to disclose the true ownership of state-backed cellular operator Safaricom prior to its planned initial public offering (IPO). The suit lodged in Nairobi’s High Court says the government ‘has refused to give a full disclosure of the ownership of Safaricom and the sums received or not received in various transactions constituting its current shareholding’.

Until earlier this year it had been thought that Vodafone of the UK held a 40% stake in Safaricom, with the government retaining 60%, but investigations found that the 40% stake is actually owned by a holding company, Vodafone Kenya. Vodafone Group has 87.5% of Vodafone Kenya, giving it a 35% indirect stake in Safaricom, with 12.5% of Vodafone Kenya held by mysterious Guernsey-registered firm Mobitelea Ventures. The government is planning to sell off 25% of Safaricom by the end of this year in what could be Kenya’s largest ever IPO.

Kenya, Safaricom