The Law Society of Kenya (LSK) wants Parliament to reject the government's proposal to sell a 15 percent stake in Safaricom, citing a rushed, opaque and non-competitive transaction process.
The LSK asked the National Assembly's joint committee on Finance and National Planning and Public Debt and Privatisation to decline approval of the proposed deal in its current form until a transparent, independently verified valuation and a clearly defined, competitive sale structure is established in full compliance with Article 201 of the Constitution.
The National Treasury signed a deal to sell a 15 percent stake in Safaricom to South Africa's Vodacom Group at Sh34 per share, amounting to Sh204.3 billion.
LSK Vice President Mwaura Kabata said any proposed sale should be supported by publicly disclosed valuation methodologies, an assessment of optimal timing within the market cycle and a clear fiscal framework demonstrating that proceeds will be applied to debt reduction or productivity-enhancing capital investment rather than short-term budget support.
The LSK said the proposed divestiture would result in foreign majority ownership of 55 percent in Safaricom, reducing the government to a minority owner while Vodacom retains effective control.
The South African multinational currently owns a 35 percent stake in the telco and it will gain a controlling 55 percent interest if it concludes its proposed purchase of the government's 15 percent stake and a separate five percent from its parent firm Vodafone Group.
"This risks undermining Kenya’s strategic leverage over national data infrastructure, mobile money systems, and competition policy, while exposing critical financial and security sectors to foreign influence," Mr Kabata said.
"We respectfully urge the National Assembly to require a transparent, competitive price discovery process, including consideration of multiple bidders, require disclosure of detailed valuation, financial, and market-risk analyses, and require a comprehensive national security, data sovereignty and fiscal impact assessment."
The committee questioned LSK’s position of outright rejection of the transaction, saying the society does not appreciate Kenya’s constrained fiscal environment and the need to mobilise non-debt resources.
"You as LSK have also not proposed an alternative valuation methodology for the share price. Do you have a valuation figure other than the Sh34 the government has negotiated with Vodacom?" Julius Ruto, the MP for Kesses asked.
Mr Kabata asked the MPs to require the deal to be reviewed, revised, and subjected to wider stakeholder engagement before any implementation is undertaken.
"We propose the deferment of any divestiture of Safaricom shares until a transparent, independently verified valuation and a clearly defined, competitive sale structure is established in full compliance with Article 201 of the Constitution," Mr Kabata said.
"Any proposed sale should be supported by publicly disclosed valuation methodologies, an assessment of optimal timing within the market cycle and a clear fiscal framework demonstrating that proceeds will be applied to debt reduction or productivity-enhancing capital investment rather than short-term budget support."
