The Government has appealed against a High Court decision nullifying the sale of its 15 per cent stake in Safaricom PLC to Vodacom Group for Sh204.3 billion.
Attorney General Dorcas Oduor and National Treasury Cabinet Secretary John Mbadi have moved to the Court of Appeal, seeking to overturn the September 15 judgment and suspend its implementation pending the determination of the appeal. In separate affidavits sworn on September 17, Oduor and Mbadi argue that implementing the High Court orders could create complications because the shares have already been transferred and the transaction completed.
The Government is also seeking an immediate stay of the judgment, arguing that the shares are quoted securities in a listed company and were transferred through the Central Depository and Settlement Corporation.
The High Court, sitting as a three-judge bench, ordered the restoration of the 15 per cent stake to the Government after finding that the divestiture did not comply with constitutional and legal requirements. The court cited inadequate public participation, concealment of material information and concerns over the pricing of the shares, among other issues.
The court held that the public participation process did not meet the required qualitative and quantitative standards, finding that it was not reasonable, meaningful and purposive and that the process violated Articles 10 and 118 of the Constitution.
“Concealing or withholding material information and documents during public participation violates constitutional transparency requirements and invalidates the resulting policies or projects because it renders public engagement a cosmetic formality rather than a meaningful exercise.”
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The Government has told the Court of Appeal that it received Sh204.3 billion from the sale of the 15 per cent stake, which was transferred at Sh34 per share. It argues that the proceeds are non-refundable while the High Court orders require the shares to be restored.
The Government has also told the Court of Appeal that it received Sh40.2 billion as an upfront payment in lieu of future dividends on its remaining 20 per cent stake. It argues that restoring the 15 per cent holding without addressing the payments made under the transaction could create further complications.
The transaction involved about 6.01 billion Safaricom shares and was completed on June 30, 2026, after the Court of Appeal lifted conservatory orders. Safaricom confirmed that the transaction had been completed on that date.
The Government argues that steps to give effect to the High Court orders could be taken at any time and, once implemented, could be difficult or impossible to reverse. It has therefore asked the appellate court to suspend implementation of the judgment until the appeal is heard and determined, arguing that failure to grant a stay could undermine its intended appeal.
The Government further argues that the dispute raises issues of public interest relating to fiscal planning, capital-market stability, investor confidence and Kenya’s external position.
The State has maintained that the partial divestiture followed due process and has rejected the High Court’s findings. Mbadi previously said the Government would challenge the judgment through the appropriate legal channels.
“We do not accept that the safeguards built into this transaction, including the protections extended to Safaricom’s employees, dealers and business partners, amounted to the constitutional and procedural failures as the court has asserted, and we intend to make that case fully on appeal,” Mbadi stated.
The Government has now lodged its appeal as the dispute moves to the Court of Appeal, where the stay application and the substantive challenge to the High Court decision will be considered.
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