Kenya’s government has announced plans to offload part of its 34.9% stake in Safaricom, the region’s most profitable telecommunications company, in a bold move to raise KSh149 billion ($1.16 billion) during the 2025/26 financial year. This privatization effort is part of a broader strategy to plug a widening budget deficit, ease rising debt repayment burdens, and avoid further tax increases amid mounting public discontent.
Treasury Cabinet Secretary John Mbadi confirmed the plan in an interview with Business Daily, stating that the transaction would likely be Kenya’s largest divestiture in nearly two decades. “There is talk that if we could offload more of our ownership of Safaricom, we are likely to get the KSh149 billion through privatization in the 2025/26 financial year,” he noted.
Safaricom, which commands over 65% of Kenya’s mobile market, reported an 11% increase in net profit to KSh69.8 billion ($540 million) in 2024. The firm remains a reliable revenue stream for the state, delivering a dividend of KSh1.20 per share, earning the government KSh16.8 billion ($130.5 million). Its current market valuation puts the government’s stake at approximately $2.1 billion (KSh280.5 billion).
Since its oversubscribed IPO in 2008, where the government sold a 25% stake and raised $400 million (KSh51.75 billion), there has been little change in public shareholding until now. Options being considered for the new sale include a secondary public offering through the Nairobi Securities Exchange (NSE) or a block sale to institutional or private equity investors.
Kenya’s public debt now stands at a staggering $88.5 billion (KSh11.4 trillion), up by over $20 billion since President William Ruto took office in 2022. The government spent KSh722 billion ($5.5 billion) on interest payments in the first eight months of the 2024/25 fiscal year alone—over half of the total tax revenue collected in that period. Debt servicing costs are projected to surpass KSh1 trillion ($7.7 billion) by year-end.
With declining fiscal space and growing public opposition to further taxation, the state is now turning to its most valuable assets, such as Safaricom, for revenue generation. Mbadi emphasized that the sale will prioritize transparency and public participation, potentially inviting local retail investors to buy into the telecom giant.
The privatization is part of President Ruto’s broader economic reform plan, which aims to increase private sector involvement in state-owned enterprises across telecom, energy, and transport sectors.
If successful, the move will not only bolster Kenya’s struggling finances but also mark a shift in the government’s approach—from direct ownership to a more regulatory role in strategic industries—positioning the private sector to play a larger role in national development.