Vodafone Group has announced that its wholly-owned subsidiary, Vodafone International Holdings, has agreed to transfer part of its indirect shareholding in Kenyan telecoms operator Safaricom to Vodacom Group. Vodafone currently holds a 40% indirect interest in Safaricom through a wholly-owned subsidiary, Vodafone Kenya (VKL), but under the terms of the deal, Vodacom has agreed to acquire an 87.5% shareholding in VKL, representing a 34.9% indirect interest in Safaricom. In exchange, Vodafone will acquire 226.8 million new ordinary Vodacom shares, increasing its ownership in Vodacom from 65.0% to 69.6%. The UK-based group will retain the remaining 12.5% shareholding in VKL (representing a 5.0% indirect interest in Safaricom) following the transfer, in addition to the indirect interest held through Vodacom.
Completion of the transaction, which has a value of ZAR34.6 billion (USD2.6 billion) and is expected to take place in the third quarter of 2017, is subject to a number of conditions. These include approvals from Vodacom minority shareholders, approval from the Financial Surveillance Department of the South African Reserve Bank and confirmation from the Kenya Capital Markets Authority that the transaction does not trigger an obligation for Vodacom to make a mandatory bid for Safaricom.