Vodacom Moves to Rewrite Safaricom’s Rulebook at the 31 July AGM

Safaricom has called its annual general meeting for Friday, 31 July 2026, and on the surface the agenda looks ordinary. Shareholders will be asked to adopt the accounts for the year to 31 March 2026, approve a final dividend of KES 1.15 per share, re-elect a handful of directors, and re-appoint Ernst & Young as auditors. Sitting underneath that routine is the real business: fourteen special resolutions that would rewrite large parts of Safaricom’s constitution, the Articles of Association.

These changes did not come from the board. They were formally requested by Vodafone Kenya Limited (VKL), the holding vehicle now wholly controlled by South Africa’s Vodacom, using a shareholder’s legal power to force items onto the agenda. The requisition reached the company on 6 July 2026, and the notice went out two days later.

The timing follows directly from what happened at the end of June. On 30 June 2026, Vodacom completed its purchase of the Kenyan government’s 15% stake in Safaricom, lifting VKL’s direct holding to about 55%. In the same transaction, Vodacom also bought out Vodafone Group’s remaining slice of VKL, taking full ownership of that vehicle. The effect was to give a single shareholder outright majority control of Safaricom for the first time since the company listed in 2008. The government’s stake dropped from 35% to 20%, and public investors on the Nairobi Securities Exchange keep the remaining 25%. We covered that completion and the earlier court fight that delayed it in detail.

What the Articles are, and why the vote is high

The Articles of Association are the internal rulebook that governs how a company is run: who sits on the board, how the chief executive is chosen, and what needs a special vote. Changing them requires a special resolution, which under Kenya’s Companies Act must be approved by at least 75% of the votes cast at the meeting. Voting will be by poll, so each share counts rather than each raised hand.

Cluster one: writing Vodacom’s control into the rulebook

Read together, the resolutions do two things. The first is to formalise Vodacom’s control.

One amendment gives VKL the right to appoint one director for every complete 10% of Safaricom it holds. At 55%, that is five board seats. Another says that, for as long as VKL holds more than 50%, the chief executive will be appointed from a list of nominees supplied by VKL. A third makes the chief finance officer the automatic stand-in, or “alternate director,” for the chief executive at board meetings, again while VKL stays above 50%. A fourth sets out how boardroom deadlocks are broken. If the directors are split even after a second vote on the same matter, the decision goes the way the majority of VKL-appointed and government-appointed directors want it.

Cluster two: the government’s shrinking role, written down

The second thing the resolutions do is put the government’s reduced position into the rulebook. As part of approving the sale, Parliament attached conditions meant to keep Safaricom recognisably Kenyan, and the Articles now try to lock some of those in.

The definition tied to the government’s shareholding is being updated from the older Treasury designation (“PST”) to “CST,” the Cabinet Secretary to the National Treasury, or any wholly state-owned body set up to hold the shares. That final phrase is broad. It is wide enough to cover the government’s remaining 20% sitting in a state-owned vehicle, such as a sovereign or infrastructure fund, rather than with the Treasury directly. Like VKL, the government (as “CST”) gets one director for every complete 10% held, which is two seats at 20%. That matches the condition Parliament set when it cleared the sale.

Two further amendments hand the state a veto over big strategic moves. Any material change to the Safaricom brand would need both 75% of the directors and the consent of the Government of Kenya. Any expansion of the business into new countries beyond Kenya and Ethiopia would also need government consent. Separate clauses require the board to keep a majority of Kenyan independent directors and to preserve a “predominantly Kenyan character” in senior management. That last line is not new. It was first added in 2017 when Vodacom took its original stake, and it is being carried forward.

The board is not backing any of this

The notice states plainly that the directors make no recommendation on the special resolutions, and make no representation that the resolutions comply with the Companies Act, the corporate governance code for listed firms, or the NSE listing rules. In practice, that means the board is neither endorsing the changes nor vouching for their legality. Shareholders are being told to decide for themselves. A board making no recommendation is not by itself unusual when a controlling shareholder forces resolutions onto the agenda. The pointed part is the second half. Declining to state whether resolutions of this weight comply with the law leaves shareholders, including the 25% held by the public, to judge that for themselves.

The outcome is close to settled

Whether the resolutions pass is barely in doubt. A special resolution needs 75% of the votes cast, VKL holds 55%, and the government holds 20%. Together that is exactly 75% of all Safaricom shares. Many of the amendments protect the government’s own position, from its two board seats to the brand veto, so the Treasury has clear reasons to vote in favour. If it does, the resolutions clear the bar comfortably, whatever the 25% held by the public chooses to do.

Two caveats sit behind that. The first is that it assumes the government votes in favour, which is likely but not confirmed. The second is that it assumes VKL and the government can each vote on all fourteen resolutions, rather than any being set aside for minority shareholders to decide on their own. Whether some of these amendments count as transactions that benefit the controlling shareholder, and so need a separate minority vote under the capital markets rules, is exactly the kind of question the board’s silence on legal compliance leaves open.

What the meeting will actually reveal is the scale of any dissent from minority shareholders. Those investors were not offered a buyout when control changed hands, because the Capital Markets Authority exempted Vodacom from having to make a mandatory offer for the remaining shares.

The dividend, for those who came for the money

For most shareholders the more immediate item is cash. The KES 1.15 final dividend, on top of the KES 0.85 interim already paid, brings the full-year payout to KES 2.00 per share, or about KES 80.1 billion in total. That is a 66.7% jump on last year and the sharpest single-year rise in the dividend since Safaricom listed, funded by net income that grew about 67% to KES 99.7 billion. We broke down that result and how the ownership change complicates it separately. The final dividend will be paid on or about 4 September 2026 to shareholders on the register at the close of business on 4 August.

Nothing here changes anything day to day for customers. M-PESA keeps working, phone numbers stay the same, and Safaricom stays listed in Nairobi. What the 31 July meeting settles is who holds the levers above all of that: a controlling shareholder in Johannesburg that, if the resolutions pass, will be able to name the chief executive, and a government in Nairobi that has traded ownership for a set of protections, some already binding from the sale terms and some being voted on at this meeting. The one thing still open is the courts. The main case challenging the legality of the stake sale was heard at the end of June, and a ruling from the High Court is still pending. That decision could reopen questions the AGM is trying to close.