Vodacom Group said the latest court ruling allows the African telecom operator to retain the additional 15% of Safaricom shares that gave it control of the Kenyan operator until a fast-tracked appeal is heard.

According to a corporate filing on the Johannesburg Stock Exchange (JSE) on Friday, Vodacom said the Court of Appeal maintained that its subsidiary, Vodafone Kenya, remains the registered holder of the Safaricom shares it bought from the Kenyan government on 30 June. The court also directed that the purchase price paid to the government be preserved pending the hearing of the appeal.

"The Court decided not to determine the application but instead recorded to fast-track the substantive appeal," Vodacom said in the statement, adding that "the prevailing status quo in respect of the shares and purchase consideration shall be maintained pending the hearing of the appeal."

In practical terms, the order defers the legal question to the appeal rather than settling it, locking in the current position — the shares registered to Vodafone Kenya and the purchase funds preserved — until the substantive case is heard.

Addressing the 15% share acquisition that lifted Vodacom's stake in Safaricom from 40% to 55%, the company noted the Court of Appeal's wording: "The effect of the order is that VKL remains the registered holder of the Safaricom shares acquired from the Government of Kenya (GoK) on 30 June 2026, and the corresponding purchase consideration paid to GoK is to be preserved, pending the hearing of the appeal."

The development follows a Kenyan court ruling that nullified Vodacom's 15% acquisition of the 35% stake held by the GoK in Safaricom. That court declared the process illegal and found that the $1.9 billion deal violated public-finance management laws.

With the appeal expected to be fast-tracked, Vodacom said it remains confident in the strategic rationale for the acquisition and will continue to update shareholders on developments relating to the appeal process.

Kenya's privatisation push and the deal's structure

In December, the GoK under President William Ruto's administration decided to sell part of its 35% stake in Safaricom. The sale was pivotal to the government, sitting at the centre of how it planned to fund a significant chunk of public spending. With limited room to borrow more or raise taxes further, Kenya has turned to selling stakes in state-owned assets, including Safaricom and Kenya Pipeline Company, to finance infrastructure projects under Ruto's $39 billion development plan. The government aims to build key infrastructure such as railways, airports, roads, power lines, dams, and irrigation schemes, and to cut transportation costs.

Vodacom agreed to raise its stake in Safaricom from 40% to 55% by buying 15% of the Kenyan government's shares in the operator, reducing the government's holding to 20%. Those 15 percentage points are what carry Vodacom past the halfway mark, converting a minority holding into the majority control now preserved by the Court of Appeal. The transaction also required it to acquire Vodafone International Holdings' remaining 12.5% stake in Vodafone Kenya, making Vodacom the unit's sole owner. Vodacom therefore holds the Safaricom stake through its subsidiary, Vodafone Kenya.

The sale, completed in June 2026, raised about 204.3 billion shillings ($1.6 billion), along with additional 40.2 billion shillings ($300 million) from the securitisation of future dividends.

September ruling and the appeal

However, a Kenyan court ruling in September by Judges Francis Gikonyo, Roselyne Aburili and Tabitha Ouya ordered that the 15% stake in Safaricom Plc be returned to the government after finding that the divestiture was carried out against the Constitution and did not involve public participation, as the 15% share belonged to the people of Kenya.

Vodacom subsequently said it would appeal the Kenyan High Court decision, maintaining that it followed due process in the 15% stake acquisition. If the appeal is unsuccessful, the Kenyan government would have to refund the $1.9 billion it already received for the stake sale. The fast-tracked hearing will therefore determine both whether Vodacom keeps the majority control it gained in June and whether the government keeps the $1.9 billion in sale proceeds or has to return it.