South Africa’s Vodacom will determine Safaricom’s next CEO if it acquires a majority stake in the telecom by purchasing the Kenyan Government’s 15 percent stake, under an agreement that will make Safaricom a subsidiary of Vodafone Group.
Disclosures by Vodafone Group—Vodacom’s parent company—show that Safaricom’s board would be required to appoint the chief executive from a list of nominees provided by Vodafone Kenya Limited (VKL), potentially returning the era of expatriate CEO at the Kenyan telco.
Vodafone Group, which owns 65 percent of Vodacom, has committed to influence the pick of a chair who will be Kenyan.
This looks set to return a leadership structure that Safaricom held for years, to 2020, when the telco had an expatriate CEO and Kenyan chairman.
Vodacom currently owns 39.9 percent of Safaricom through Vodafone Kenya, a holding vehicle of Vodacom and its parent firm Vodafone in the Kenyan telco.
Vodacom’s stake in Safaricom will increase to 55 percent after buying the 15 percent stake and Vodafone’s direct shares, equivalent to 4.9 percent, giving the South African group effective control of the Nairobi bourse-listed firm.
The deal has prompted the inking of a new shareholder agreement that guides the hiring of Safaricom’s CEO and chair.
Vodafone, which will have an indirect 35.75 percent stake in Safaricom given its 65 percent ownership of Vodacom, filed the new agreement with the US Securities and Exchange Commission (SEC) on May 22.
The disclosure is linked to the fact that Vodafone has a primary listing on the London Stock Exchange and a secondary listing on the NASDAQ, the second-largest stock exchange in the world, located in New York City.
“The Directors may subject to the provisions of the Article 102 from time to time appoint a Chief Executive Officer as an executive director of the Company from a list of nominees provided by VKL (for as long as VKL holds more than 50 percent of the nominal value of the issued as fully paid share capital of the company excluding any shares hereafter issued pursuant to any share issuance to Article 13 (c),” reads part of the agreement.
“VKL hereby undertakes, insofar as possible and provided it is aware of the potential appointment, to notify and consult with the GOK prior to the Board appointing or replacing a Chairman and/or Chief Executive Officer,” adds the agreement.
After Safaricom was launched in 2000, Britain’s Vodafone Group Plc acquired a 40 percent stake in the mobile operator, with the shareholding held through VKL.
At the same time, South African-born Michael Joseph was appointed the company’s first chief executive.
In 2007, Vodafone Group restructured its African operations by transferring 35 percentage points of its Safaricom stake to South Africa’s Vodacom Group, leaving the British telecommunications giant with a direct five percent shareholding in the Kenyan firm.
Under the current transaction, Vodafone will transfer its remaining five percent stake in Safaricom to Vodacom, effectively consolidating all of the group’s ownership in the telecoms operator under the South African subsidiary.
The move will leave Vodacom with full ownership of VKL, the vehicle through which the group’s Safaricom investment is held. Vodafone Group remains the controlling shareholder of Vodacom with a 65 percent stake.
The National Treasury, which will retain a 20 percent stake in Safaricom after the transaction, will, however, have a say in the appointment of the chairman, with Vodacom agreeing to have a Kenyan head the board of the telecom’s giant, according to the agreement.
“VKL further undertakes, insofar as possible, to ensure that the Chairman is of Kenyan nationality.”
Vodacom has also agreed to have most of Safaricom’s senior executives remain Kenyan, contenting itself with a decisive say over who occupies the corner office of the Nairobi Securities Exchange-listed firm.
Vodacom inked an agreement with the Treasury in December to purchase a 15 percent stake in Safaricom for Sh204.3 billion.
The company is also paying the government an upfront dividend of Sh40.2 billion on its remaining 20 percent stake, to be recouped from the State’s future dividends.
The purchase of the Treasury’s shares will lift Vodacom’s stake to 55 percent, giving the South African group effective control of Safaricom, best known for its M-Pesa mobile money platform.
This means that Safaricom will become a subsidiary of Vodacom Group and will be expected to follow its policies, standards, procedures and programmes, including those relating to financial reporting, governance, legal affairs, compliance, ethics, risk management, procurement and operations, according to the agreement signed on December 3, 2025.
Although the proposed sale has been given the green light by the National Assembly and the regional anti-trust body, the COMESA Competition Commission (CCC), it was suspended by the High Court on May 18 pending the hearing and determination of a petition filed by activist Tony Gachoka and three others.
For nearly two decades after its launch, Safaricom was led by expatriate executives—first South African-born Michael Joseph and later British-South African Bob Collymore. Both Mr Joseph and the late Collymore later got Kenyan citizenship.
The appointment of Peter Ndegwa in 2019 after Collymore’s death marked a historic shift, making him the first Kenyan to head East Africa’s most profitable company amid growing calls for the country’s largest listed firm to be run by a local executive.
The issue of who should lead Safaricom has long attracted political interest due to the company’s dominant role in Kenya’s economy and telecommunications sector.
