KENYA – The Government of Kenya, through The Treasury, has acquired a 60 per cent stake in Telkom Kenya from UK-based private equity fund, Helios Investment Partners, for KSh6.09 billion (US$50.40m), making the company fully State-owned.
The exit comes six years after Jamhuri acquired majority ownership in the integrated telecommunications solutions provider from France Telecom in June 2016, through its local subsidiary Orange.
Jamhuri Holdings Limited notified the government of its intention to exit Telkom in August 2021.
The collapse of the proposed merger between Telkom and Airtel Kenya following disapproval of the transaction by the government may have accelerated the exit.
The deal marks a rare return of a privatised company to State ownership, derailing initial plans for the listing of Telkom Kenya at the Nairobi Stock Exchange (NSE) through an initial public offering (IPO).
France’s Orange bought a majority share in Telkom Kenya when it was privatised in 2007 but then sold its stake to London-based Helios Investment in 2015 for undisclosed fees.
At KSh6.09 billion (US$ ), the deal values Telkom Kenya at KSh10 billion (US$ ), equivalent to one per cent of the KSh1 trillion (US$ ) valuation of Safaricom—the dominant market leader.
Telkom Kenya, which is Kenya’s third-biggest telecommunications company by users, has been losing subscribers in recent years.
The operator’s mobile phone subscribers dropped from 4.23 million users in 2019 to 3.42 million in June, representing a 19.1 percent fall, in a period when its rivals—Airtel and Safaricom have gained customers.
In 2015, Helios exited Equity Bank Group with the sale of its final stake to the National Social Security Fund (NSSF) Uganda, following exits to Norwegian investment fund, Norfund and UK investment management firm, Genesis Investment Management LLP.
More recently, Helios exited its investment in Vivo Energy to Vitol Group following an earlier partial exit through a public listing on the London Stock Exchange.
Helios’ current investments are spread across several firms and countries in East Africa in Financial Services, technology, infrastructure, Healthcare, Energy, and customer sectors.
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