Market News

Government Now Owns 100% Of Telkom Kenya

BY Juma · October 4, 2022 09:10 am

KEY POINTS

Helios is the latest international operator to quit Kenya, where Safaricom, part-owned by Vodacom and Vodafone, has 67 percent of 36 million mobile users.

KEY TAKEAWAYS

Telkom Kenya is currently valued at 10 billion shillings. Compared to Safaricom that is valued at 1 trillion shillings, Telkom Kenya's value is just an iota of it. The takeover is also being seen as a move by the government to try and neutralize the power of Safaricom.

The Government of Kenya now owns 100 percent of Telkom Kenya after buying back 60 percent of the company shares from a UK-based private equity fund, Helios Investment Partners, for 6.09 billion shillings.

The acquisition of Telkom Kenya marks a rare return of a privatized company to State ownership. This also derails initial plans for the listing of Telkom Kenya at the Nairobi Stock Exchange (NSE) through an initial public offering (IPO).

Telkom Kenya is currently valued at 10 billion shillings. Compared to Safaricom that is valued at 1 trillion shillings, Telkom Kenya’s value is just an iota of it. The takeover is also being seen as a move by the government to try and neutralize the power of Safaricom.

Telkom Kenya, which is Kenya’s third-biggest telecommunications company by users, has been losing subscribers in recent years. The operator’s mobile phone subscribers dropped from 4.23 million users in 2019 to 3.42 million in June, representing a 19.1 percent fall, in a period when its rivals—Airtel and Safaricom have gained customers.

Helios is the latest international operator to quit Kenya, where Safaricom, part-owned by Vodacom and Vodafone, has 67 percent of 36 million mobile users.

There have been calls from part of the country’s leadership to have Safaricom and M-Pesa run as different entities. Some information has confirmed that Safaricom might be split from M-Pesa as soon as January 2023.

About Juma

Juma is an enthusiastic journalist who believes that journalism has power to change the world either negatively or positively depending on how one uses it. (020) 528 0222 or Email: info@sokodirectory.com