Vodacom Group Ltd. is set to take control of Safaricom Plc after striking a $2.1 billion deal to acquire additional shares from the Kenyan government and Vodafone International Holdings BV, a move that deepens its bet on East Africa’s most profitable telecom market.
In a stock-exchange filing, the South African operator said it will buy a 15% stake held by Nairobi and an effective 5% from Vodafone. Vodacom will also make a separate upfront payment of 5.3 billion rand ($310 million) for the right to receive future dividends previously allotted to the Kenyan state.
The purchases will lift Vodacom’s ownership of Safaricom — long the region’s most valuable listed company — from 39.93% to 54.9%. According to Bloomberg, two people familiar with the talks said Vodacom has explored raising its stake even further, though no final decision has been reached.
Read Also: Mali recovers $1.2bn in arrears from miners after companies’ audit
Vodacom is financing the deal through loans from Vodafone and a Kenyan shilling facility backed by the group.
The company said the acquisition strengthens its hand in mobile money, digital lending and digital wallets, areas Safaricom dominates through its M-Pesa platform. Vodacom said the expanded control fits into its broader financial-inclusion strategy across Africa.
Safaricom, which controls nearly two-thirds of Kenya’s mobile market, is valued at 1.19 trillion shillings ($9.13 billion).
For Kenya, selling part of its holding also helps raise much-needed revenue as the government grapples with climbing debt-service costs and persistent budget gaps.