Vodacom hit by shock court ruling

Vodacom

Johannesburg – Vodacom is facing a major setback in Kenya after the country’s High Court nullified the government’s sale of a 15% stake in Safaricom to the South African telecommunications group.

The ruling puts uncertainty over Vodacom’s control of Safaricom, East Africa’s largest mobile operator, after the transaction increased its effective shareholding in the company to 55%.

According to BusinessTech, the Kenyan court ordered that the 15% stake be returned to the government after finding that the transaction violated public-finance management laws and did not fully comply with public-participation requirements.

The three-judge bench, comprising Francis Gikonyo, Roselyne Aburili and Tabitha Ouya, delivered the judgment in Nairobi on Tuesday.

Vodacom said it would challenge the decision.

“As interim steps, Vodacom will lodge an appeal against today’s decision with the Court of Appeal and will also apply for a stay pending the determination of the appeal,” the company said.

$1.6 billion deal

Reuters reported that the transaction, announced in December 2025 and completed in June, was valued at about $1.6 billion and increased Vodacom’s Safaricom stake to 55%, while Kenya’s government stake fell to 20%.

The deal formed part of Kenyan President William Ruto’s efforts to raise funds for public finances as the country faces significant debt repayments.

However, the High Court found that the public had not been adequately involved in the transaction and that material information had been concealed, Reuters reported.

Kenya’s government has also indicated that it will appeal the ruling.

Finance Minister John Mbadi said the government remained confident that the transaction had complied with the law.

“We intend to make that case fully on appeal. The National Treasury will pursue this appeal vigorously,” Mbadi said.

The legal challenge adds uncertainty to Vodacom’s strategy in Kenya, where the Safaricom acquisition was intended to strengthen its position in one of Africa’s most important telecommunications markets.

Moneyweb reported that Vodacom shares fell nearly 4% in Johannesburg trading following the ruling before recovering some of the losses.

The company’s appeal and its application for a stay will determine whether the current ownership structure remains in place while the legal dispute is considered by the Court of Appeal.

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