Leading investment banker Jimnah Mbaru has urged the Kenyan government to consider an alternative route to the planned partial divestiture of its 15 per cent stake in Safaricom Plc, proposing a secondary initial public offering (IPO) instead of a direct negotiated sale.
His remarks come amid a heated national debate on how best to manage state assets and deepen the country’s capital markets.
Mbaru’s comments, posted on social media platform X, emphasise the strong demand for quality equities in Kenya’s financial markets and the strategic value of Safaricom as a flagship stock on the Nairobi Securities Exchange (NSE).
“The Kenya government should seriously consider issuing a secondary IPO for the 15 per cent shareholding in Safaricom,” Mbaru wrote, arguing that the market is hungry for quality stocks and that Safaricom is a robust, liquid company with broad appeal across East Africa and beyond.
A secondary IPO, he said, could raise the required funds in less than one month while offering retail and institutional investors direct participation.
Mbaru highlighted that such a public offering would deepen and broaden Kenya’s capital market, enhancing liquidity and reinforcing Nairobi’s role as a regional financial centre.
“East Africa and the world would love this stock,” he wrote, suggesting that many senior government officials privately support this route but have been reluctant to voice it publicly.
The government is currently pursuing a block sale of its stake — approximately 6.01 billion shares — at about KSh 34 per share, in a negotiated deal with strategic investor Vodacom Group.
Under the plan, Vodacom’s shareholding would expand significantly, while the State’s ownership would fall to 20 per cent.
Proceeds are earmarked for development initiatives, including a National Infrastructure Fund and a Sovereign Wealth Fund, as part of broader fiscal reforms.
Treasury officials defending the current sale structure argue it secures a premium price and avoids diluting market share prices through a large retail offer.
They also say underwriting costs and market saturation risks make an open IPO less optimal.
Critics of the direct sale contend that the government might be undervaluing the asset and limiting opportunities for ordinary Kenyan investors to benefit directly from one of the country’s most valuable companies.
Mbaru’s proposal for a secondary IPO spotlights an unresolved policy question: whether Kenya should prioritise immediate capital mobilisation through strategic investors or leverage its public markets to deepen local investor participation and strengthen long‑term market infrastructure.