Cabinet Cancels Ksh.6B Telkom Kenya Buyout Deal, Demands Refund
The Cabinet has announced the cancellation of the government’s purchase of a 60 percent stake in Telkom Kenya, valued at slightly more than Ksh.6 billion.
In a communiqué to newsrooms following a meeting chaired by President William Ruto, the Cabinet stated that the government will now pursue a refund of the aforementioned sum from Jamhuri Holdings and Helios Investment Limited for the buyout deal.
Cabinet rescinded the decision to purchase from Jamhuri/Helios sixty percent (60%) of Telkom Kenya’s ordinary shares to address the governance challenges posed by the nationalization of Telkom Kenya Limited in the run-up to last year’s General Election.
“As a result of this Cabinet decision, Jamhuri/Helios will refund the Government of Kenya the amount paid as the takeover consideration.”
It added: “The Cabinet’s decision allows Telkom Kenya to identify and welcome another strategic investor, pending receipt of regulatory approvals.” Cabinet’s intervention will increase Telkom Kenya’s operational capacity and make it a more competitive participant in the Kenyan telecommunications market.”
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The investigation into the controversial acquisition of Telkom Kenya in March of this year took an unexpected turn when former Treasury Cabinet Secretary Ukur Yatani disclosed that the government was the company’s majority shareholder.
Yatani, speaking when he appeared before the Parliamentary committee investigating the buyout, said that contrary to claims that the government paid and did not receive the shares from Helios Limited, all the transfer documents are at the National Treasury.
He informed the joint committee, however, that the shareholding status had not been changed at the State law office at the time because the Telkom Kenya board that was supposed to initiate the changes had not been duly constituted.
Yatani stated at the time that the payment had been approved following a meeting of the National Security Advisory Council, which wished for Telkom to be fully owned by the government as it manages critical security installations such as the President’s office, State House, the Defence headquarters, and the National Intelligence Service, in addition to operating the IFMIS portal.
Cabinet Cancels Ksh.6B Telkom Kenya Buyout Deal, Demands Refund