The Court of Appeal on Tuesday rejected applications by the government and Vodacom to suspend High Court orders that nullified the State’s sale of a 15 per cent stake in Safaricom PLC, leaving the September judgment in force while the parties pursue an appeal.
A three-judge bench of Justices Luka Kiprotich Kimaru, Johnson Okello and Kathurima M’Inoti held that the stay bids lacked merit. “We therefore reject the government and Vodacom’s applications to suspend the High Court judgment pending the determination of their intended appeal for lack of merit,” the judges ordered, according to The Standard.
What the High Court struck down
On September 15, Justices Francis Gikonyo, Roselyn Aburili and Teresia Wanjiku Ouya declared the divestiture unconstitutional, invalid, null and void. They quashed Sessional Paper No. 3 of 2025 and related approvals and agreements, and ordered the shares restored to government ownership.
The dispute turns on the transfer of 6,009,814,200 ordinary Safaricom shares — 15 per cent of the government’s holding — to Vodafone Kenya Limited, a Vodacom group subsidiary. The deal closed on July 6, 2026. The State received about Sh204.3 billion for the shares and a further Sh40.168 billion in lieu of future dividends on its retained stake.
Treasury warned of forex and CDSC reversal risk
Attorney General Dorcas Oduor told the appellate court that enforcing the High Court orders before the appeal was heard could render the intended challenge moot and complicate reversing a completed transaction. Treasury Cabinet Secretary John Mbadi swore that the shares had already moved and that unwinding the deal would require reversing Central Depository and Settlement Corporation entries and securing cross-border regulatory approvals.
The State said the sale generated roughly US$1.557 billion in foreign-currency inflows and argued that reversal could force repayment or withdrawal of a large capital inflow, with knock-on effects for fiscal planning, investor confidence and the exchange rate. It also said the appeal raised serious questions on Section 87A of the Public Finance Management Act, Parliament’s role in approving the sale, and the High Court’s decision to quash regulatory approvals.
Petitioners led by Tony Gachoka opposed the stay. They have attacked the legality of the transaction, public participation, valuation and the approval process. With the stay refused, the High Court orders remain operative unless and until the Court of Appeal decides the main appeal differently — leaving Safaricom’s share register, Vodacom’s enlarged stake and the Treasury’s fiscal arithmetic under a cloud that markets and regulators will have to navigate day by day.
Sources: The Standard | People Daily
Photo: Tall Black / Wikimedia Commons (CC BY-SA 4.0)
