The High Court has referred a petition challenging the planned sale of government shares in Safaricom PLC to Chief Justice Martha Koome for the formation of a multi-judge bench, after the judge handling the case stepped aside due to time constraints.
In its ruling, the court consolidated three petitions contesting the proposed divestiture and certified the matter as raising substantial constitutional questions requiring determination by an unevenly expanded bench.
The decision comes against the backdrop of parliamentary approval of the transaction, which is set to take effect from April 1, 2026, subject to regulatory clearances.
The case pits petitioners Tony Gachoka and Fredrick Ogola against several State agencies, Safaricom PLC and Vodacom Group over the legality of the government’s plan to reduce its stake in the telecom giant. The other two petitions were filed by Paul Maina and Mr Samuel.
The court said the petitions revolve around “the proposed divestiture of the government shareholding” in Safaricom and raise similar legal and factual questions, justifying consolidation to avoid duplication and reduce costs.
The National Treasury signed a deal to sell a 15 percent stake in Safaricom to South Africa’s Vodacom Group for Sh34 per share, totalling Sh204.3 billion.
The South African multinational currently owns a 35 percent stake in the telco and 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. The government’s ownership will drop to 20 percent.
Beyond the upfront cash proceeds, the government is also set to receive about Sh40 billion in advance payments tied to future dividends from its remaining stake, although part of this will be offset by structured repayments over several years.
The transaction, first agreed in December 2025 and later approved by Parliament, is part of President William Ruto’s broader fiscal strategy to raise funds and ease budget pressures.
However, it has sparked intense public and political debate due to Safaricom’s status as a highly profitable “crown jewel” asset and a critical pillar of Kenya’s digital economy.
The court found that the dispute transcends a commercial disagreement and raises weighty constitutional issues, including national security, public participation and the prudent use of public resources.
“The petitioners have unequivocally identified core constitutional questions pertaining to the process that has attracted significant public interest; hence, it behooves this court to address and determine those concerns, not only to resolve the current dispute, but to ensure future processes will not attract constitutional litigation as constitutional parameters for such processes will have been judicially clarified,” the court stated.
It added that the issues “are weighty and transcend the interest of the parties,” meeting the threshold for certification under Article 165(4) of the Constitution.
Security questions
The court pointed to concerns over whether Safaricom constitutes strategic national infrastructure and whether transferring control to a foreign entity could undermine Kenya’s economic stability and national security.
It also flagged questions on intergenerational equity and whether the sale process complied with constitutional principles of transparency, accountability and public participation.
The respondents, including the National Treasury Cabinet Secretary, had argued the dispute was merely commercial and urged the court to dismiss it under the doctrine of constitutional avoidance. The court rejected that position.
“I very humbly and respectfully disagree with the contention by the respondents,” it ruled, affirming the constitutional nature of the case.
Time constraints
However, the court declined to determine key pending applications, including requests for conservatory orders and preliminary objections on jurisdiction. It cited the limited time before the judge’s transfer and the need to allow all parties, including Vodacom Group, adequate opportunity to respond.
“This court is constrained and is unable to deal with all the issues fully due to the limited time it has in its hands before proceeding on transfer,” said the judge.
He directed parties that had not responded to applications to do so within seven days, leaving substantive decisions to the bench to be appointed.
