Irungu Nyakera, Nairobi Patron of the Democracy for Citizens Party (DCP), has voiced strong criticism of the move, arguing that the government must exercise caution in managing the proceeds.
The proposed transaction is priced at Ksh34 per share, approximately 20 per cent above the current market value.
The proposed transaction is priced at Ksh34 per share, approximately 20 per cent above the current market value.
The sale is expected to raise around Ksh244–245 billion for the state, including an advance dividend.
Vodacom’s effective control of Safaricom will rise to roughly 55 per cent, while the government’s shareholding will fall from 35 per cent to about 20 per cent.
Nyakera, a former Principal Secretary, acknowledged that the deal itself is commercially reasonable given that Vodacom already holds a majority stake.
Nyakera, a former Principal Secretary, acknowledged that the deal itself is commercially reasonable given that Vodacom already holds a majority stake.
However, he stressed that the real concern lies in how the government uses the funds.
“While the sale is neither unusual nor rushed, the key question is whether the government will invest the proceeds wisely. Past experiences have shown that large public windfalls often disappear into routine spending, leaving little long-term benefit,” Nyakera stated.
With the 2027 elections approaching, Nyakera warned that political considerations could influence how the funds are spent.
“While the sale is neither unusual nor rushed, the key question is whether the government will invest the proceeds wisely. Past experiences have shown that large public windfalls often disappear into routine spending, leaving little long-term benefit,” Nyakera stated.
With the 2027 elections approaching, Nyakera warned that political considerations could influence how the funds are spent.
He expressed concern that the money might be diverted to short-term expenditures rather than strategic investments that could boost Kenya’s development.
“If the funds are used for short-term political relief instead of productive projects, Kenya risks losing control over a critical national asset without achieving meaningful gains for the country,” he added.
Proponents of the sale argue that the transaction has several advantages. Selling the stake at a premium ensures that the government receives a favourable price.
“If the funds are used for short-term political relief instead of productive projects, Kenya risks losing control over a critical national asset without achieving meaningful gains for the country,” he added.
Proponents of the sale argue that the transaction has several advantages. Selling the stake at a premium ensures that the government receives a favourable price.
The deal also provides a non-debt option for raising funds, which could be directed toward infrastructure and development projects without increasing public borrowing.
Additionally, with Vodacom holding a larger share, Safaricom may benefit from increased investment and technological expertise, which could strengthen the company’s growth and regional integration.
Additionally, with Vodacom holding a larger share, Safaricom may benefit from increased investment and technological expertise, which could strengthen the company’s growth and regional integration.
These developments are expected to improve services for consumers and boost economic performance.
Expert Opinions
Economic analysts have weighed in, noting that while the financial terms are attractive, the true impact depends on fiscal discipline.
Expert Opinions
Economic analysts have weighed in, noting that while the financial terms are attractive, the true impact depends on fiscal discipline.
Strategically directing the proceeds into long-term projects could accelerate Kenya’s infrastructure development, education initiatives, and digital economy expansion.
On the other hand, failure to prioritize structural investment could result in short-lived political gains with little lasting improvement to public services or national wealth.
On the other hand, failure to prioritize structural investment could result in short-lived political gains with little lasting improvement to public services or national wealth.
Nyakera’s caution reflects broader concerns about transparency and accountability in handling major government revenues.
The Safaricom stake sale highlights a critical crossroads for Kenya. While the deal could provide significant resources for development, the government’s stewardship will determine whether the transaction benefits the nation in the long run.
The Safaricom stake sale highlights a critical crossroads for Kenya. While the deal could provide significant resources for development, the government’s stewardship will determine whether the transaction benefits the nation in the long run.
Citizens, policymakers, and analysts alike are closely monitoring how the proceeds will be used.
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