Safaricom

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Safaricom was granted a 15-year mobile phone license in 1997 as a fully owned subsidiary of Telkom Kenya. In May 2000, UK-based Vodafone Group Plc acquired a 40% stake and management responsibility for the company. Vodafone paid US$30 million license fee in 1999, but was required to pay an additional US$22 million the following year. As of end 2004, Safaricom had a market-leading 2.4 million subscribers to Celtel Kenya’s 1.3 million. Safaricom was investing heavily on system upgrading and had invested about US$500 million in the network. As of 31 March 2005, Safaricom had reported 2,512,826 subscribers, and was expected to reach around 3.5 million subscribers by the end of March 2006. Safaricom invested 12.4 billion Kenya Shillings (US$171 million) this year. Safaricom has announced that it would invest 14 billion Kenya shillings (US$191.8 million) in the financial year to 31 March 2006. In November 2007, the Communications Commission of Kenya granted Safaricom the first third generation (3G) licence for US$25 million. In June 2008, the Kenyan government divested 25% of Safaricom Limited for $833.04 million. Following this partial divestiture, the government of Kenya held 35% of the company and Vodafone Kenya (composed by Vodafone (87.5%) and Mobitelea Ventures (12.5%)) held 40%. The rest 25% was owned by individual shareholders and institutional investors. Dyer & Blair Investment Bank acted as broker for this transaction and Linklaters LLP advised Safaricom on the transaction. Use Wireless Intell. Use Annual Report: http://www.safaricom.co.ke/index.php?id=585 http://www.safaricom.co.ke/2005/default2.asp?active_page_id=165 http://www.safaricom.co.ke/2005/default2.asp?active_page_id=376 28 March 2005 WMRC Daily Analysis English Copyright 2005, World Markets Research Centre Limited. All Rights Reserved Safaricom has announced that it will invest 14 billion Kenya shillings (US$191.8 million) in the financial year to 31 March 2006. Some 6 billion shillings will be invested in a base station transceiver (BTS) roll-out, particularly in rural areas. The company's chief executive, Michael Joseph, also said that the operator would launch new services enabled by a new Intelligent Network (IN) platform, provided by Huawei. The operator plans to reach around 3.5 million subscribers by the end of March 2006. - Safaricom, Kenya's biggest mobile phone firm, sees its subscriber base rising to four or five million by 2007. The company, 40 per cent owned by British mobile operator Vodafone and the rest by state-run Telkom Kenya, currently has just over three million subscribers in Kenya, east Africa's largest economy. Safaricom's target when it began trading in 2000 was three million subscribers by 2020, but by October 2004 it already had 2 million out of a total Kenyan population of 32 million. Safaricom recorded a 42.7 percent rise in annual revenues to 26.91 billion shillings ($365.6 million) in the year ended March 31. Net profit surged 69.8 per cent to 5.86 billion. Vodafone, the world's largest operator by revenue, has offered $100 million to raise its 40 per cent stake in Safaricom to 51 per cent, saying a controlling stake would make it easier for the company to borrow to fund further expansion. "The only comment I can make is that to date the government has not come back to respond to this offer," Joseph said. The Safaricom CEO also said the company had no plans for a local share listing and that its two shareholders had not raised the matter. "There has been no discussion of this amongst the shareholders. It would be a wonderful thing of course, but it's not a management decision," he said. Capex 2012: Wireless Intelligence