Vodacom Group has entered into an agreement with Kenya’s government to acquire 15% of Safaricom and an additional 5% from Vodafone at KES34 a share, in a deal valued at $2.1-billion, or R36-billion.

This will increase Vodacom’s stake in Safaricom – which will remain listed on the Nairobi Stock Exchange – from 35% to 55%, subject to requisite approvals from regulatory and governmental authorities in Kenya, Ethiopia and South Africa.

“This landmark transaction will mark a pivotal step in Vodacom’s journey to accelerate growth and deepens our impact across Africa. Acquiring a controlling stake in Safaricom strengthens our position as a market leader, while at the same time unlocking new opportunities to drive digital and financial inclusion at scale in Kenya and Ethiopia,” said Vodacom Group CEO Shameel Joosub.

“I look forward to working even closer with the Safaricom team and taking some of the learnings from their success and leveraging it across the group,” he commented, noting that Safaricom’s outstanding track record and differentiated growth outlook complements Vodacom’s Vision 2030 ambitions.

Safaricom is widely regarded as one of Africa’s most attractive assets, combining telecommunications, fintech and technology services. It has consistently delivered strong financial results, with industry-leading margins and resilient cash generation.

Through the flagship platform M-Pesa in Kenya, it drives high-growth fintech revenue, while expansion opportunities in Ethiopia and a growing suite of cloud, Internet-of-Things and enterprise services position Safaricom for continued growth.

“Vodacom has been a trusted partner in Safaricom’s journey from the very beginning, and we welcome their continued commitment and long-term investment in our business,” said Safaricom CEO Peter Ndegwa.

“Their confidence in Safaricom is a testament to the strength of our people, our strategy and the opportunities ahead. We look forward to deepening our collaboration as we continue to scale innovation, expand regionally and deliver transformative digital and financial services to our customers.”

The transaction is also one of the first steps in the President’s agenda of innovatively unlocking capital, without increasing taxes or the countries debt burden, to allow additional investment in critical infrastructure to support future growth, added Kenya National Treasury and Economic Planning Cabinet Secretary John Mbadi.

“Safaricom has been, and continues to be, a key strategic investment for us, as we are retaining a 20% stake as well as board representation.”

This transaction underscores Vodacom Group’s vision of converting scale, customer momentum, and strategic investments into sustainable value for all stakeholders, while staying true to its purpose of connecting people to a better future.

In accordance with International Financial Reporting Standards, Safaricom’s financial results will transition from being accounted for on an associate basis to being fully consolidated, increasing Vodacom Group’s revenue towards R220-billion.