Kenya Mulls Major Shake-Up at Safaricom With Potential Spin-Offs
As Safaricom faces calls for a major restructuring, the debate over its future stretches from boardrooms to mobile users across Kenya.
Safaricom, the Nairobi-listed giant that dominates Kenya’s telecoms and mobile money landscape, may be headed for one of the most significant corporate shake-ups in its history. The government is weighing whether to split the company into three independent units: a core mobile service, a tower business, and M-Pesa as a standalone financial entity.
Treasury Cabinet Secretary John Mbadi has said the state sees “huge benefit” in such a restructuring.
The idea is that each business line would operate with greater efficiency — the mobile unit handling voice and data, a tower company managing network infrastructure, and M-Pesa operating under the direct watch of the Central Bank of Kenya.
M-Pesa’s Dominance Under Scrutiny
For regulators, M-Pesa remains the focal point. The platform processes more than nine in every ten mobile money transactions in Kenya, making it the unrivaled leader in digital payments. That dominance has drawn concern from competition watchdogs, who argue the service is too powerful to sit within a telecom operator that already commands the lion’s share of the mobile market.
The Central Bank has signaled its support for a spin-off, framing the move as a matter of financial stability and consumer protection. Critics, however, warn that separating M-Pesa could create new operational risks and weaken Safaricom’s ability to invest in the broader digital economy.
A Clash of Interests
Safaricom’s management has consistently resisted the idea of a break-up. Chief Executive Peter Ndegwa said last year that a group structure would deliver more value for shareholders than a separation of assets. The company and Vodacom jointly acquired the M-Pesa platform from Vodafone in 2020, and since then, it has become Safaricom’s crown jewel.
From the government’s perspective, however, the calculus is slightly different. Nairobi holds a 35 percent stake in Safaricom, and any move that boosts valuation would help shore up public finances. A spin-off of M-Pesa, in particular, could attract new investors and give the state a much-needed windfall.
What’s at Stake
For shareholders, the key question is whether carving up Safaricom creates value or erodes the synergies that have made it East Africa’s most profitable company. For consumers, the outcome could redefine how they interact with telecom services and mobile money, sectors that underpin Kenya’s digital economy.
The debate is far from settled, but the stakes are clear. Safaricom is not just another listed company; it is a pillar of Kenya’s financial markets and a linchpin in everyday transactions. Breaking it apart would mark a turning point — not just for the operator, but for the entire ecosystem built around it.
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