Vodafone Kenya Ltd has announced plans to acquire additional 15 percent stake in giant telecommunications company Safaricom.
In a notice, the firm however says it will not initiate a takeover of Safaricom, despite holding 55 percent shareholding of the telco. The additional shares will be acquired from the government of Kenya.
“The GOK and the general public investors will retain approximately 20 percent and 25 percent of Safaricom’s shareholding, respectively. The GOK Share Acquisition and the Vodafone Kenya Acquisition are inter-conditional shareholder to shareholder transactions,” the notice reads in part.
At a cost of Ksh34 per share, the acquisition is set to earn the National Treasury Ksh204.3B for the over 6B issued shares.
Vodafone Kenya Ltd is jointly owned by Vodacom and Vodafone.
The deal will also see Vodacom, increase its shareholding in Vodafone Kenya to 100 percent through an internal reorganization. This will involve the purchase of Vodafone International Holding BV 50 ordinary shares, representing a 12.5 percent stake in Vodafone Kenya.
The reorganization will ultimately see it acquire 5 percent stake indirectly in Safaricom. The reorganization deal is estimated to cost Ksh68.1B.
”VKL has also agreed to buy the right to receive future Safaricom dividends and will make an upfront payment of Ksh40.2B to GoK in lieu of the future dividends that will accrue to the GoK’s residual 20 percent shareholding in Safaricom,” the notice explains.
At the conclusion of the deal, the government of Kenya will still have an opportunity to appoint two directors to the Safaricom board. Vodacom also says it will not implement any merger related redundancies in the next 3 years and will keep the firms chairman’s role and independent directors to Kenyans.