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Safaricom shareholders are set to vote on a series of governance reforms that could significantly reshape the company’s leadership structure following Vodafone Kenya Limited’s emergence as the telecommunications firm’s majority shareholder.
The proposals, scheduled for consideration at Safaricom’s Annual General Meeting on July 31, seek to align the company’s governance framework with its new ownership structure after Vodafone Kenya increased its stake to 55 percent through the acquisition of an additional 15 percent shareholding from the Kenyan government.
If approved, the amendments would represent the first major revision of Safaricom’s constitutional documents since Vodafone Kenya assumed majority control.
Majority Shareholder to Gain Leadership Nomination Rights
A key proposal would grant Vodafone Kenya the authority to nominate Safaricom’s Chief Executive Officer, subject to approval by the company’s board of directors, as long as it maintains ownership of more than 50 percent of the company’s issued share capital.
The proposed framework would also allow the majority shareholder to nominate executive directors and shareholder-appointed board members during the period in which it retains controlling ownership.
In addition, the proposals include provisions relating to board succession and executive representation, including arrangements under which the Chief Financial Officer would serve as the alternate director to the Chief Executive Officer while Vodafone Kenya maintains its majority stake.
Governance Framework to Reflect New Ownership Structure
Safaricom is also seeking shareholder approval to replace its existing ownership thresholds of 10 percent and 40 percent with a single 50 percent benchmark, bringing its Articles of Association in line with Vodafone Kenya’s controlling interest.
The board is further proposing the removal of provisions requiring government approval before expanding operations beyond Kenya and Ethiopia. Future international expansion decisions would instead be managed through the company’s internal governance processes, reflecting the government’s reduced ownership position.
Additional amendments would update references to Vodafone Kenya and government-appointed directors while removing legacy provisions that no longer reflect Safaricom’s current shareholding structure.
Board Operations and Corporate Governance
The proposed reforms also introduce changes aimed at modernising board operations and improving corporate governance.
These include mechanisms for resolving board deadlocks, enabling directors to attend meetings and vote electronically, expanding the circumstances under which extraordinary general meetings may be convened, and formally recognising written board resolutions.
Safaricom is also seeking to remove the requirement that the executive committee be predominantly composed of Kenyan nationals, while maintaining board composition requirements stipulated under Kenyan law.
Another proposed amendment would eliminate the obligation to maintain a formal dividend policy, allowing the board greater flexibility in making dividend recommendations based on the company’s financial performance.
Ownership Transition
The governance proposals follow the completion of the Kenyan government’s stake sale on June 30 after the Court of Appeal lifted conservatory orders that had temporarily suspended the transaction.
Following the acquisition and subsequent corporate restructuring, Vodafone Kenya—wholly owned by South Africa’s Vodacom Group—now holds a 55 percent stake in Safaricom. The Kenyan government retains a 20 percent interest, while public investors own the remaining 25 percent of the company.
Although the Capital Markets Authority granted Vodafone Kenya an exemption from making a mandatory takeover offer after crossing the 50 percent ownership threshold, legal proceedings challenging the government’s share sale remain before the High Court.
Dividend Proposal
At the Annual General Meeting, shareholders will also consider a proposal to approve a final dividend of KSh1.15 per share for the financial year ended March 31, 2026.
If approved, the payment would bring the total annual dividend to KSh2.00 per share, with eligible shareholders on the register as of July 24 expected to receive payment on or around August 4.
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