Smells like success lakini beberu amefanya ile kitu.
Remember initially Safcom Ltd had 55.7% ownership effectively giving it control.
IFC came in and invested $160M diluting Safcom Ltd to 47% ownership.
So these guys let Safcom Ltd take all the initial risk, and after sensing victory they swooped in to buy equity.
I still don’t understand why Safcom Ltd agreed to relinquish control over Safcom Ethiopia when they could have simply used debt instead of giving away equity. They already have 145 billion in retained earnings. They can easily afford the $160M in cash or loans.
Anyway, again, mwafrika amechezwa akili and lost control of possibly the next success story.
Safaricom Ethiopia is no longer a subsidiary of Safaricom Ltd. It is an affiliate.
Now, Safaricom Ltd, Kenya’s top taxpayer, has no control over its investment in Ethiopia, after tying up hundreds of millions of shareholder dollars. Now, nothing stops the other entities from simply diluting Safaricom Ltd to smithereens because they have deeper pockets.
Safaricom shareholders took all the risk upfront and now they have no way of preventing a take-over of that entity because they no longer have 50%+1 shareholding.
I don’t understand how the press only mentioned this in passing considering the seriousness of the issue particularly to the Kenyan government. Kenya, through Safaricom Ltd (Wanjiku 001) no longer controls Safaricom Ethiopia.
@Azor Ahai ushai sikia makanga wakisema matatu yao haiwezi shikwa juu fulani fulani ndiye mwenyewe ama fulani fulani ni shareholder? Ata kama una pesa, huna power, hapo ndio IFC huingilia.
Watu ya Naivas wamesurvive sababu waliuza. Nakumatt ilikuwa strong bora tu Harun Mwau alikuwa shareholder. Equity Bank pia
That’s how these people operate even in the first world… it’s not a national issue. Peter Ndegwa and Michael Joseph allowed it because it’s good business for them, not because Wanjiku’s okoa jahazi limit matters.
They might decide to diversify their book and venture into other things like the expansion of their microfinance and launching satellites and compete with Starlink.
“…Expansion into Ethiopia’s telecommunications market is capital intensive, where the financial investment is expected to top the $1 billion (Sh120 billion) mark”
Ethopia is a new market, it’s give and take. Wangeamua kubaki na shares zao wangetoa wapi $120M ya kuchezea. Vile @sani amekwambia it’s beyond shares, it’s security
One day in history you will hear, SafariCon Kenya buys back the shares sold for $160 Million at $1,600 Million.
Vodafone is the bigger Kingpin. Their original Dictator.
Note, during the SafCon IPO Citi was the Lead Transaction Advisor. Made me want to open an account with Citi Kenya. Where Waiguru honed her skills in saying errors of ‘0’.
Wrong. Safaricom is not a subsidiary of vodafone. Please, take accounting lessons and you will understand the difference between a subsidiary, an associate/affiliate, and an investment.
Safaricom had the capacity to invest its own money or SE could have taken a loan (kama haja ni kutotumia pesa yao).
I explained clearly how any company can raise money without giving away control by having two classes of shares with equal access to dividends, but different voting power. Read that comment and understand.
There was also a caveat wakipewa hizo pesa ; no use of superior and affordable Huawei or ZTE equipment in the rollout .In the end ,hii pesa yote imeenda na Nokia na Ericsson .