A SAFARICOM OUTLET ON MOI AVENUE, NAIROBI. FILE PHOTO | NMG
Summary
- The deal, valued at about Sh266.6 billion, received the backing of its Vodacom’s largest institutional investor — South Africa’s Public Investment Corporation (SOC) — in June.
- The deal is still subject to some regulatory approvals in Kenya and South Africa.
- The proposed share swap is expected to bring to an end a clause that barred Safaricom from venturing outside Kenya.
Vodacom has said its bid to acquire a 35 per cent stake in Safaricom
is expected to be completed by tomorrow after the South African teleco’s minority shareholders approved the transaction.
The
deal, valued at about Sh266.6 billion, received the backing of its
Vodacom’s largest institutional investor — South Africa’s Public
Investment Corporation (SOC) — in June ahead of a shareholders’ meeting
this month.
Minority shareholders on July 18 voted in
favour of the transaction, paving the way for Vodacom’s entry into the
Kenyan market by buying off the stake held by British multinational
Vodafone which holds a 40 per cent shares in Safaricom.
“At
the general meeting, shareholders resolved to approve this transaction,
which we expect to be effective on or about August 1, 2017,” Vodacom
said in a statement.
The deal is still subject to some regulatory approvals in Kenya and South Africa.
The
proposed share swap is expected to bring to an end a clause that barred
Safaricom from venturing outside Kenya as this would be in direct
competition to Vodacom.
While Safaricom will still not
be free to enter Vodacom markets in Africa, it will now move to new
countries where the South African firm does not have a presence. Vodacom
will in turn be free to use M-Pesa in its markets.
“The
vote of confidence from minority shareholders is an important milestone
in our journey to become a leading digital company...,” Vodacom’s group
CEo Shameel Joosub said.
“This is an exciting deal
that provides Vodacom shareholders with access to a high growth, high
margin and high cash generating business in the attractive Kenyan
market.”
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