Vodacom, South Africa’s largest mobile operator, has announced a deal to acquire a controlling stake in Safaricom, East Africa’s largest telecoms firm, for $2.1 billion. The agreement, subject to regulatory approval, would increase Vodacom’s footprint across the continent.

The transaction involves Kenya’s government selling a 15% stake in Safaricom, while British Vodafone will offload an additional 5%. This would raise Vodacom’s stake in the Nairobi Stock Exchange-listed company from 35% to 55%. The deal comes as Kenya’s government seeks to generate revenue by selling state assets.

According to Shameel Joosub, Vodacom Group’s chief executive, the acquisition is a significant step in the company’s growth strategy. “This landmark transaction will mark a pivotal step in Vodacom’s journey to accelerate growth and deepen our impact across Africa,” he said. The deal is expected to strengthen Vodacom’s position as a market leader and unlock new opportunities for digital and financial inclusion in Kenya and Ethiopia.

Safaricom, one of East Africa’s largest companies, was granted a license to operate in Ethiopia in 2021, becoming the first private telecommunications provider in the country. The company’s mobile money service, M-Pesa, launched in Kenya in 2007, has become a vital tool for bill payments and money transfers. Today, M-Pesa is used by millions of people in seven African countries and generates over 40% of Safaricom’s profit.

The acquisition is expected to have significant implications for the African telecommunications industry. With Vodacom’s increased stake in Safaricom, the company is well-positioned to drive growth and expansion in the region. The deal is subject to regulatory approval, and its outcome is likely to be closely watched by industry stakeholders and investors. As the African telecommunications landscape continues to evolve, this transaction is set to play a key role in shaping the industry’s future.