Kenya Court Keeps Safaricom Sale Ruling in Force
KENYA · SAFARICOM
Key Facts
- —The country Kenya is home to Safaricom, the mobile operator behind M-Pesa and one of the biggest companies on the Nairobi Securities Exchange.
- —Why it matters The state sold 15% of Safaricom to Vodacom for about KES 204.3 billion (about US$1.58 billion). The High Court voided that sale on 15 September.
- —Why now The Court of Appeal refused to suspend the Safaricom sale ruling in a decision reported on Tuesday 13 October.
- —What happened Justices Luka Kiprotich Kimaru, Johnson Okello and Kathurima M’Inoti rejected the stay applications of the government and Vodacom “for lack of merit”.
- —The numbers 6,009,814,200 shares changed hands. The state also received KES 40.168 billion (about US$310 million) in lieu of future dividends.
- —What it means for US readers Vodafone, whose receipts trade on Nasdaq, controls Safaricom through Vodacom. That control stays legally uncertain until the appeal is decided.
- —Still open When the main appeal is heard, how the shares would return to the state, and whether any money must be refunded.
Kenya’s Court of Appeal has refused to suspend the Safaricom sale ruling, which voided a 15% state stake sale to Vodacom. The decision, reported on Tuesday 13 October, leaves orders restoring the shares to government ownership in force.
The stake was sold for KES 204.3 billion (about US$1.58 billion), and the buyer, Vodacom, is controlled by Britain’s Vodafone. Vodafone’s American depositary receipts trade on Nasdaq, so the dispute reaches US portfolios as well as Kenyan ones.
Dollar figures here use the Central Bank of Kenya’s official rate of KES 129.71 per US dollar on 13 October. The ruling does not end the case, because the main appeal against the September judgment is still to be heard.
What the Appeal Court Decided
A three-judge bench of Justices Luka Kiprotich Kimaru, Johnson Okello and Kathurima M’Inoti heard the applications. The government, through the Office of the Attorney General, and Vodacom had each asked for a stay pending their intended appeal.
The judges rejected both requests, according to The Standard and People Daily, two Nairobi newspapers. Both papers quoted the order as dismissing the applications “for lack of merit”.
People Daily reported that the bench found the applications did not meet the required threshold for a stay. The detailed reasoning of the court has not yet been reported.
The petitioners, including Tony Gachoka, opposed the applications. They had challenged the legality of the sale, its public participation, its valuation and the procedures used to approve it.
What the High Court Nullified
On Tuesday 15 September, three High Court judges declared the divestiture unconstitutional, invalid, null and void. They also quashed the decision in Sessional Paper No. 3 of 2025, along with related approvals and agreements.
The dispute centres on 6,009,814,200 ordinary Safaricom shares, equal to 15% of the company. They were transferred to Vodafone Kenya Limited, a subsidiary of the Vodacom group.
The government received about KES 204.3 billion (about US$1.58 billion) for the shares, The Standard reported. It also received KES 40.168 billion (about US$310 million) paid in lieu of future dividends on its remaining stake.
The court ordered the shares restored to government ownership. That order now stands while the appeal moves forward.
Background on the September decision is in Kenya Court Voids Safaricom Stake Sale to Vodacom. A profile of the company is in What Is Safaricom, Kenya’s M-Pesa Giant Explained.
Why the State and Vodacom Wanted a Pause
Attorney General Dorcas Oduor argued that enforcing the judgment before the appeal could make the appeal ineffective. She said it would also complicate unwinding a transaction that had already been completed.
Treasury Cabinet Secretary John Mbadi said in an affidavit that the shares had already been transferred. Reversing the deal, he said, would involve settled entries at the Central Depository and Settlement Corporation and cross-border regulatory approvals.
The government warned that the judgment could disrupt fiscal planning, investor confidence and Kenya’s foreign-exchange position. Its application said the sale had brought foreign-currency inflows of about US$1.557 billion that might have to be repaid or withdrawn.
The State said its appeal raises serious legal questions, including the reading of Section 87A of the Public Finance Management Act. It also cited the role of Parliament in approving the sale and the quashing of regulatory approvals.
The government said the orders affect third parties, including investors who hold Safaricom’s publicly traded shares. It maintained that the sale had the necessary approvals and was meant to fund infrastructure through the National Infrastructure Fund.
Who Owns Safaricom Now
Vodafone said on 30 June that Vodacom had completed buying an effective 20% of Safaricom, lifting its holding to 55%. Of that, 15% came from the Government of Kenya and 5% from Vodafone for KES 68 billion (about US$524 million).
Vodafone said Safaricom would be fully consolidated by both Vodacom and Vodafone. Vodacom is the Johannesburg-listed African arm of the Vodafone group, which controls it.
The nullified sale is the 15% bought from the government, according to both newspaper reports. Neither report says whether the 5% bought from Vodafone is affected.
What It Means for US Readers
For Vodafone shareholders, including holders of its Nasdaq-listed receipts, control of Safaricom remains legally uncertain until the appeal is decided. Neither report suggests any change to Safaricom’s M-Pesa or mobile services in the meantime.
For investors weighing Kenya, the Safaricom sale ruling shows that a completed privatisation can be challenged in court after the money moves. The appeal continues, however, so the High Court judgment could still be overturned at a full hearing.
The sale also matters for the shilling, because the government says it brought in about US$1.557 billion of foreign currency. The government argues that repaying it could strain Kenya’s foreign-exchange position, though neither report mentions a repayment order.
What Is Not Known
It is not known when the Court of Appeal will hear the main appeal against the September judgment. The detailed reasons for refusing the stay have not been reported.
It is unclear how the shares would be moved back to the government in practice. It is also unclear whether the State would have to return the KES 204.3 billion (about US$1.58 billion) it received.
Neither Vodacom nor the National Treasury was quoted reacting to the ruling in Tuesday’s reports. Whether either side will seek further relief, or whether the 5% bought from Vodafone is covered, also remains open.
Frequently Asked Questions
What did Kenya’s Court of Appeal decide on the Safaricom sale ruling?
It refused applications by the government and Vodacom to suspend the High Court judgment of 15 September while their appeal is pending. The bench rejected them for lack of merit, leaving the Safaricom sale ruling in force.
Which Safaricom sale was nullified?
The state’s sale of 6,009,814,200 Safaricom shares, about 15% of the company, to Vodafone Kenya Limited, a Vodacom subsidiary. The government received about KES 204.3 billion (about US$1.58 billion) for them.
Why did the State and Vodacom want the ruling suspended?
They argued that enforcing it before the appeal could make the appeal ineffective and complicate a completed deal. The government also cited risks to fiscal planning, investor confidence and foreign-exchange inflows of about US$1.557 billion.
What does it mean for Vodafone investors?
Vodacom, controlled by Vodafone, took its Safaricom holding to 55% in June. Until the appeal is decided, part of that stake remains under a court order restoring it to the government.
What happens next?
The Court of Appeal still has to hear the main appeal against the September judgment. No hearing date had been reported by Tuesday 13 October.
Sources: The Standard, 13 October 2026; People Daily, 13 October 2026; Vodafone, completion announcement, 30 June 2026; Central Bank of Kenya, official exchange rate, 13 October 2026.
Editorial responsibility: Matthias Camenzind, Editor-in-Chief · Editorial standards · Report an error
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