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[2008-03-26] ODM demands Safaricom IPO delay In yet another onslaught against the privatisation of mobile phone provider Safaricom, Opposition party ODM yesterday demanded that the sale be delayed to clear the air over the firm’s ownership and valuation.
The party which recently entered into a power sharing deal with the government says there are question marks over how the value of the firm’s shares was reached.
The Government plans to sell 25 per cent of its holdings in Safaricom, leaving it with a 35 per cent stake. Vodafone Kenya — a joint venture between UK’s Vodafone Plc and the controversial Mobitelea— owns 40 per cent of the company. The government expects to raise between Sh60 billion and 75 billion from the divestiture.
Each share will be trading at Sh5 and a potential investor must have not less than Sh10,000 to participate in the IPO which opens this week on Friday.
Yesterday, the ODM secretary general Anyang’ Nyong’o said the sale should be delayed because of numerous questions regarding the firm’s ownership.
The party also questioned the method used in determining the value of Safaricom’s shares.
The ODM MP also said that the preparation and submission of a privatisation strategy to Parliament for public debate was required under the privatisation Act.
“The privatisation of safaricom must be in conformity with the provisions of the privatisation Act. The process should therefore be transferred from the docket of the investment secretary at the Treasury to the remit of the privatisation commission as the law requires” said Prof. Nyong’o.
Safaricom provider which ploughed Sh17.1 billion in profits last year to become the region’s most profitable company.
