KENYAN STATE PLANS TO SELL STAKE IN TELKOM BY APRIL 2007

Mergers, Acquisitions and Financial Results

The Government plans to sell its stake in Telkom Kenya by April 2007 through an initial public offering (IPO) on the Nairobi Stock Exchange by April next year. President Kibaki said the Government would also offload of its shareholding in Safaricom to Vodafone to raise funds for restructuring Telkom Kenya before the IPO. "The Government has approved the restructuring of Telkom Kenya," President Mwai Kibaki said.

"Under this arrangement, nine per cent of the Safaricom shareholding will be sold to finance the sale of Telkom Kenya through an initial public offering to be concluded by April 2007."

Telkom Kenya owns 60 percent of Safaricom while Britain's Vodafone currently owns 40 percent. The government is hoping the Telkom IPO will be as successful as the recent sale of 30 percent of state-run Kenya Electricity Generating Company (KenGen) which was highly oversubscribed. Experts have urged the government to speed up Telkom's sale to capitalise on KenGen's good performance.

The Government plans to sell 34 percent of Telkom Kenya on the Nairobi Stock Exchange and a further 26 per cent to strategic investors after restructuring the loss-making company.

The East African Standard