The High Court of Kenya is keeping the freeze on the government’s planned sale of a 15% stake in Safaricom to South Africa’s Vodacom Group, leaving one of the largest telecoms transactions in the region’s recent history stuck in legal limbo.
A three-judge bench appointed by Chief Justice Martha Koome extended status quo orders that have been in force since 23 March 2026, after petitioners argued that allowing the sale to proceed before the case is fully heard would render any later ruling meaningless. The orders prohibit the National Treasury, Safaricom, and Vodacom from executing any part of the transaction while the constitutional petitions are pending. A ruling on the substantive application for conservatory orders was due on 18 May 2026, with Vodacom Group CEO Shameel Joosub telling investors in an 11 May earnings call: “If the conservatory orders are not lifted, the court case will continue, and it could take a few more months. So, we are a little bit in the court’s hands.”
What the deal actually is
We already broke down the structure of the deal in detail in December, but here is the short version. Under the agreement signed by the Treasury in late 2025, the government would sell 6 billion Safaricom shares, representing 15% of the company, to Vodacom at KES 34 per share. That direct sale alone is worth KES 204.3 billion. On top of that, Vodacom would pay a KES 40.2 billion upfront dividend, backed by the government’s remaining 20% stake, bringing the total payout to Treasury to roughly KES 244.5 billion.
If the deal closes, the government’s stake in Safaricom drops from 35% to 20%. Vodacom currently holds an effective 34.94% interest in Safaricom indirectly, through its 87.5% stake in the Vodafone Kenya Limited holding vehicle. As part of the transaction, Vodacom is also buying out Vodafone’s remaining 12.5% in that vehicle for KES 68.1 billion, which gives it the additional 5% indirect interest in Safaricom held by Vodafone. Once both deals close, Vodacom’s total holding moves to roughly 55%, giving it majority control for the first time since Safaricom’s 2008 listing. The proceeds from the government’s share of the transaction are earmarked for the newly established National Infrastructure Fund, created by President William Ruto in March 2026 to bankroll roads, energy, and water projects.
Why the courts got involved
Three petitions were filed and later consolidated by the Judiciary. The lead petitioners are Tony Gachoka and Professor Fredrick Ogola, with two other petitions from Paul Maina and a litigant identified only as Mr Samuel. Wiper Party leader Kalonzo Musyoka is acting as senior counsel and has separately filed his own petition. Former Nairobi Governor Mike Sonko has also applied to be enjoined in the case.
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The petitioners are making three core arguments. First, they say the KES 34 per share price is a significant undervaluation, with estimates of intrinsic value placed between KES 70 and KES 80 per share. Second, they argue the process violated the Constitution by failing to conduct meaningful public participation under Article 10 and bypassing the transparency and accountability requirements of Article 227 on disposal of public property. Third, and most weightily, they say transferring majority control of Safaricom, which runs M-Pesa and hosts sensitive digital infrastructure for platforms like e-Citizen, to a foreign company creates a national security and data sovereignty risk.
Safaricom, for its part, has told the court the dispute is “largely commercial” and that halting the deal would distort the market and shake investor confidence. The Attorney-General and the National Treasury have made similar arguments.
What this means in practice
For now, nothing changes for Safaricom customers. Numbers stay the same, M-Pesa keeps working, and the share remains listed on the Nairobi Securities Exchange. The freeze does not affect day-to-day operations.
What it does affect is timing and money. The Treasury was originally expecting the funds in March 2026. With the freeze still in place, Treasury Cabinet Secretary John Mbadi has said the budget will be implemented “in the usual way” with or without the proceeds. But the longer the deal sits in court, the more pressure builds on both sides: the government wants the cash for its infrastructure fund, Vodacom wants to consolidate Safaricom into its accounts (which would more than double its reported EBITDA), and Safaricom itself is operating with strategic uncertainty over its majority shareholder.
The court’s eventual decision will turn on a single question: is the sale of a 15% stake in a listed company a routine commercial transaction, or is Safaricom different enough, as the petitioners argue, that selling control requires a higher constitutional bar than Parliament has already cleared?
That is the question the bench is now sitting on. Until they rule, the deal stays where it is.
