The Kenyan government could gain the final say over any future expansion of Safaricom beyond Kenya and Ethiopia under proposed changes to the telecommunications company’s governance structure.
In a notice convening its 2026 Annual General Meeting (AGM), Safaricom’s board has asked shareholders to approve a special resolution requiring government consent before the company enters any new international market outside its current operations.
The proposal forms part of a package of 14 special resolutions submitted by Vodafone Kenya Limited (VKL) following the recent restructuring of Safaricom’s shareholding, which saw the National Treasury transfer its 15 percent stake to South Africa’s Vodacom.
The transaction increased Vodacom’s shareholding in Safaricom from 35 percent to 55 percent, making the Nairobi Securities Exchange-listed telecommunications firm a subsidiary of Vodafone Group Plc. Vodacom also acquired an additional five percent stake from its parent company, Vodafone Group.
Under the proposed changes, any decision to expand Safaricom’s operations beyond Kenya and Ethiopia would require the approval of the Government of Kenya.
“Notwithstanding anything to the contrary contained in these articles, any resolution relating to… the expansion of the business of the Company into new territories outside of Kenya and Ethiopia shall not be deemed to have been passed unless the consent of the Government of Kenya has been obtained,” the AGM notice states.
Safaricom currently operates in Kenya, where it was launched in 2000, and Ethiopia, which it entered in 2022 after securing the country’s first private telecommunications licence through the Global Partnership for Ethiopia consortium.
The government is expected to retain a 20 percent stake in Safaricom following the sale, allowing it to continue benefiting from dividends while maintaining influence over strategic decisions.
The proposed veto power reflects Safaricom’s growing importance to Kenya’s economy beyond its telecommunications business.
The company operates M-Pesa, one of the country’s largest digital payments platforms, supports key government digital services and remains one of Kenya’s biggest taxpayers and dividend contributors.
Safaricom’s expansion into Ethiopia has required significant capital investment and has weighed on the group’s profitability as it continues to build network infrastructure and expand its customer base.
Although subscriber numbers in Ethiopia have continued to grow, the business is yet to become profitable, limiting the company’s ability to increase dividend payments to shareholders. Safaricom expects the Ethiopian operation to record its first operating profit by the end of the current financial year.
The board is also seeking shareholder approval for a proposal requiring at least 75 percent of directors to support any material change to the company’s brand, with such changes also requiring government approval.
“Any resolution relating to … any material change of the Company’s brand shall not be deemed to have been passed unless at least seventy-five per cent of Directors vote in favour of the resolution and the consent of the Government of Kenya has been obtained,” the notice states.
In addition, shareholders will vote on proposals that would give Vodacom the right to nominate Safaricom’s next Chief Executive Officer for as long as it holds more than 50 percent of the company’s issued share capital.
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