The High Court has nullified the government's sale of a 15 per cent stake in Safaricom to Vodacom, ruling that the transaction violated the Constitution and ordering the shares restored to the State.
A three-judge bench found that the government failed to conduct adequate and meaningful public participation before disposing of the stake.
The court said the partial divestiture of shares in Kenya’s largest telecommunications company amounted to a major public policy decision that required informed participation by Kenyans.
Judges also faulted the Cabinet and National Assembly, saying the public was not given sufficient information to properly scrutinize the transaction.
The court found that key details surrounding the sale were not adequately disclosed, undermining constitutional requirements on transparency and accountability.
It warned that withholding material information risked reducing public participation to a “cosmetic formality rather than a meaningful exercise.”
The bench consequently quashed approvals and arrangements linked to the transaction and ordered the 15 per cent stake restored to the Government of Kenya.
The ruling reverses a deal that had already been completed after the Court of Appeal lifted orders that had temporarily blocked the sale.
Vodacom announced in June that it had completed the acquisition, increasing its effective stake in Safaricom to about 55 per cent.
The transaction reduced the government’s shareholding from 35 per cent to 20 per cent.
The State had defended the sale as part of efforts to raise funds for infrastructure projects and reduce reliance on borrowing and taxation.
National Treasury Cabinet Secretary John Mbadi had maintained that the divestiture was conducted “lawfully, transparently, and with the express authority of Parliament.”
The High Court, however, found that the process failed to meet constitutional standards on public participation, transparency and accountability, rendering the divestiture unlawful.
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