Kenyan court dismisses investigation into Telkom property sales

17 Feb 2021

Kenya’s High Court has dismissed questions raised by the Ethics and Anti-Corruption Commission (EACC) over the sale of Telkom Kenya’s properties during its privatisation, Business Daily reports. The EACC’s investigation was reportedly one of the reasons behind the decision of Telkom and its mobile competitor Airtel Kenya to abandon their planned merger in August last year. The court reportedly heard that the Communications Authority (CA) and the Competition Authority of Kenya (CAK) had informed Telkom that they would only approve the merger once the transaction was cleared by EACC, while Telkom argued that the requirement that it recall recent sales and suspend further deals pending the conclusion of the investigation would expose it to significant loss and damage. In a judgment, High Court Judge Jairus Ngaa said that the move by the EACC to recover property already sold by Telkom or prohibit any further sales was illegal.

According to TeleGeography’s GlobalComms Database, Airtel and Telkom signed an agreement in February 2019 to merge their mobile, enterprise and carrier services businesses to create a stronger challenger to Safaricom, as well as to enhance scale and efficiency, and create a larger distribution network and strategic brand presence. In August 2020, however, the pair abandoned their planned merger, citing the ‘lengthy process’ and the ‘challenges experienced in getting all the approvals required to complete the transaction’ as the reasons for doing so.

Kenya, Airtel Kenya, Communications Authority of Kenya (CA), Telkom Kenya