President William Ruto defended the phased divestiture of the government’s stake in the giant telco Safaricom, arguing it will involve a transparent process of valuing and selling a public asset.
Speaking at State House, Nairobi, on Friday, during an engagement with graduate interns onboarded under the Affordable Housing Programme, President Ruto said the government’s privatisation strategy is aimed at mobilising resources for large-scale national development.
According to the Head of State, the government had agreed that divestiture was a prudent way of unlocking capital while expanding public participation in strategic assets, citing the Kenya Pipeline Company initial public offering and Safaricom’s share sale as examples.
He noted that the government expected to raise about Ksh.110 billion from the Kenya Pipeline IPO and a further Ksh.240 billion from the partial divestiture of Safaricom, funds he said would be leveraged to unlock between Ksh.3 trillion and Ksh.4 trillion for development projects.
“This is not about politics or the next elections; it’s about transforming Kenya. We have started the process of raising the money to do it. I said Ksh.5 trillion, and it will not delay. By next year, we will have raised all of it,” he stated.
Ruto lashed out at the critics of the move, saying they are engaging in dishonest politics driven by a lack of agenda.
“You’ll hear some people saying, ‘Why are you doing this? This is wrong.’ The same people who told us, ‘Let’s do it’. We are saying we are divesting a portion of Safaricom, they are telling us who negotiated? Where is the committee that negotiated for the price of the shares? Really? Any Public Listed Company, the tested, proven, transparent valuation is done by the Capital Markets at the Exchange, not in boardrooms or committees,” Ruto stated.
“I want to tell those who people giving us lectures about what we’re doing with the IPO in KPC or Safaricom, they should spare us their political conmanship and intellectual deceit.”
Concerns recently expressed by Ndindi Nyoro before the Joint Committee on Finance and Privatisation on Tuesday, January 20, prompted Ruto’s comments.
The Kiharu MP cautioned that if the Safaricom share sale is not put through a competitive international bidding procedure, the nation could lose billions of shillings.
Nyoro said that the suggested price undervalued the asset and that each of the six billion Safaricom shares designated for sale should be priced at Ksh. 45 instead of Ksh. 34.
“We should not be discussing anything below Ksh.45 per share, but we have been held hostage by the buyer that we are now running out of breath,” Nyoro stated.
However, other players, like the Central Organisation of Trade Unions (COTU) and Central Bank of Kenya Governor Kamau Thugge, have supported the action, arguing that it would lessen the nation’s debt load.
