An expose’ by UK newspaper, the Observer has laid bare how political elites in Kenya secured shares in Safaricom running into billions through a shadowy entity known as Mobitelea Ventures.
The investigation by Finance Uncovered network, has raised serious questions about transparency and the processes by which western firms entered Africa’s telecoms markets. It now emerges that only political scions and their cronies have massively befitted.
Mobitelea’s true ownership structure remains guarded albeit tangible belief that retired president Daniel Moi and allies were behind it.
This was done by UK mobile phone giant, Vodafone which aided other African elites to ride on the mobile phone boom on the continent milking billions of shillings in the process.
In 1999, with Moi at the helm, the government allowed Vodafone Kenya to buy a 40% share in the state-controlled Telecoms operator, Safaricom, for US$42m (Sh 4.35 billion at today’s exchange rate).
Mobitelea which worked under anonymity amongst other responsibilities gave Vodafone “advice and assistance” on securing the investment, it later emerged.
In 2001 Vodafone granted Mobitelea share options in Vodafone Kenya at 1999 prices, enabling it to buy a stake in Safaricom. Finance Uncovered estimates that these options eventually yielded Mobitelea a profit of about $51m in 2009, a reflection of Safaricom’s success.
It was not until six years later when the Kenyan government floated some of its Safaricom holding, and was required to list all current shareholders that Mobitela’s involvement came ashore.
READ: Raila Odinga To Switch From Safaricom To Airtel At 4.00 Pm
When they eventually disposed off their two billion shares in Safaricom, the shadowy individuals had made a staggering Sh6 billion.
However, those involved have never been disclosed publicly and when the UK’s Serious Fraud Office approached Vodafone for further information, the company argued that it was legally obliged not to publicly disclose the identity of the beneficial owner of Mobitelea for reasons of commercial confidentiality.
This explanation has augured coarsely with well-meaning Kenyans. Renowned anti-corruption crusader John Githongo shared his concerns that the true beneficiaries behind Mobitelea had never been identified publicly.
“Reportage of these transactions continues with a bitter taste left in the mouth,” Githongo said. “How would British media and NGOs respond to the same practices if they took place within the UK?” He asked.
Though legal, questions are hitherto being raised as to whether Vodafone could have done more to ensure that ordinary Africans benefited from the transactions by ensuring that, where there were local ownership rules, the ordinary people of the country benefited, rather than the wealthy elite.”
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