Kenya lawmakers have challenged the government’s agreement with Vodacom over future dividend payments from Safaricom, citing concerns that the deal may have undervalued the country’s most profitable telecom asset.
The dispute arises from a transaction in which the Kenyan government sold a 15% stake in Safaricom to Vodacom, as part of a multi-billion-dollar arrangement that could eventually grant the South African firm majority control of the company.
Alongside the share sale, Vodacom was granted rights to approximately KSh 55.7 billion in future dividends, in exchange for an upfront payment of around KSh 40.2 billion, effectively giving the company a discount on future earnings.
While the sale provided the government with immediate funds for infrastructure and spending priorities, critics argue that transferring future dividend income from one of Kenya’s most profitable companies could erode long-term government revenue, as Safaricom has historically been a major contributor to the national treasury.
Safaricom is central to Kenya’s digital economy, dominating the mobile market and operating the influential M-Pesa mobile money platform, making the stakes of the dividend dispute particularly high.
Lawmakers have now directed the government to renegotiate aspects of the deal, emphasizing the need to protect national interests and ensure that future revenue streams are not unduly sacrificed for short-term gains.
