Eleven weeks after the Court of Appeal cleared the way for the Government of Kenya to sell 15% of its Safaricom shareholding to Vodafone Kenya, a three-judge High Court bench has undone the transaction entirely. The KSh204.3 billion sale was completed on 30 June and structured to unlock a further KSh40 billion in dividend-rights financing for the new National Infrastructure Fund (NIF). On 15 September, the court declared the sale unconstitutional, null and void. The court ordered that the shares revert to the State. 

The reversal comes amid an unusually dense run of large Kenyan transactions and should be read against that backdrop, not in isolation. In the same window, the Competition Authority of Kenya (CAK) conditionally cleared Asahi Group Holdings’ roughly KSh388 billion acquisition of Diageo’s stake in East African Breweries Plc. Access Bank’s earlier purchase of National Bank of Kenya (NBK) from KCB Group closed without incident after a multi-year regulatory process. Three transactions, three sectors, three very different paths through Kenya’s approval architecture. Only one has been unwound after completion. What separates that outcome from the other two is instructive for anyone underwriting the next transaction in the queue.  

Three Transactions, One Question  

The Asahi–EABL deal, valued at US$2.3 billion in net proceeds to Diageo and roughly US$4.8 billion in enterprise value, cleared the CAK on 10 September after nine months of review. The regulator attached conditions rather than objections: EABL must reserve funds for outstanding third-party liabilities and free up a fifth of its retail cooler space for competing brands. An earlier suit by a distributor was dismissed in April. The deal has moved through scrutiny, not around it, and remains on track for completion in the second half of the year, without a conservatory order or an annulment in its history.  

Access Bank’s acquisition of NBK offers an even clearer contrast. Announced in March 2024 and completed in May 2025, it underwent roughly 14 months of conditional regulatory review, including a Central Bank of Kenya (CBK) sign-off and a CAK requirement for Access Bank to retain most of NBK’s workforce for a year. No court intervened at any stage. The deal moved more slowly than either party wanted, but it was linear.  

Safaricom’s divestiture followed a different course. Conservatory orders were issued, then lifted on appeal, then the transaction closed, and now a full merits hearing has reversed it after the fact. The difference is neither sector nor size; Asahi–EABL is comparable in scale, arguably larger. The difference is where scrutiny fell in the sequence, and how much of it was resolved before the deal closed rather than after.  

The Reversal Decision  

The timing distinguishes this ruling from the earlier phase of the litigation. Conservatory orders suspend a transaction before completion; annulment reverses one already carried out. Vodafone Kenya had taken delivery of the shares, the agreed conditions had been met, and the Nairobi Securities Exchange had recorded the block trade months before the bench convened. The court found that the process breached Articles 10 and 201 of the Constitution, citing inadequate public participation and the judges’ concern about “unexplained obscurity” surrounding the buyer’s identity. The decision therefore applies to a transaction the market had treated as complete. That distinction matters more to investors than the legal reasoning alone because it alters the meaning of completion.  

The judgment’s other findings sharpen the point. The bench held that the per-share price of KSh34 had been fixed before a transaction adviser was engaged, making the valuation process, in its view, arbitrary rather than merely imperfect. It further found that Cabinet and Parliament had approved a partial share sale that, in substance, amounted to a change of control, handing Vodacom effective oversight of Safaricom in a manner not contemplated by Sessional Paper No. 3 of 2025. These findings point to a constitutional test for divestitures, one that Asahi–EABL and Access–NBK, as private-sector transactions outside that specific constitutional frame, were never required to pass. Yet the underlying discipline they describe, front-loaded public participation and valuation sequencing, travels across sectors even where the legal test does not.  

Different Judicial Nuances  

The Court of Appeal’s earlier intervention lifted the conservatory orders after finding that halting the transaction risked harm to employees, market confidence and the State’s fiscal position, outweighing the harm of allowing it to proceed pending a full hearing. That was a provisional judgment on relative risk, not a final determination of legality. The High Court’s September ruling addressed a different issue: whether the transaction, as executed, complied with the Constitution.  

Read together, the two rulings are less a contradiction than a reminder that interim relief and substantive judgment operate on separate tracks. A transaction cleared under the first can still fail the second. For a market accustomed to treating the lifting of an injunction as a green light, that distinction has not previously carried much practical weight, but it does now.  

Investors Will Now Price the Risk of Reversal  

The immediate market reaction was measured against the scale of the ruling. Safaricom shares fell by roughly 4.7% on the Nairobi bourse, while Vodacom’s Johannesburg-listed stock also slipped. The muted response still points to a more durable concern than a single day’s trading. Capital markets price legal finality as much as legal outcome, and a transaction that can be unwound eleven weeks after closing changes how every subsequent state divestiture, bank consolidation or cross-border acquisition is underwritten.  

Due diligence teams will now ask not only whether a deal has cleared the conservatory-order stage, but also whether its public participation record was fully documented and whether transaction advisers were engaged before valuation decisions were finalised. Deals like Asahi–EABL and Access–NBK, which absorbed that scrutiny up front rather than defending it after closing, have become the reference points against which the Safaricom sequence is now measured.  

The government’s response, including a Notice of Appeal filed by the Attorney General and Treasury’s public insistence that the divestiture met constitutional standards, signals that the matter is far from settled. National Treasury Cabinet Secretary John Mbadi has argued that, in his account, public participation in this transaction was more extensive than in comparable cases. Vodacom has indicated it will seek a stay pending its own appeal. Safaricom, for its part, has confirmed that operations in Kenya and Ethiopia remain unaffected and that the transaction was completed after the agreed conditions precedent had been satisfied. Each position will now be tested at the Court of Appeal for the second time, on a fuller record.  

Clarity and Predictability as the Next Test  

The more consequential story is not who prevails on appeal, but what the sequence reveals about the gap between interim judicial relief and durable legal certainty in Kenya’s privatisation and consolidation programme, broadly defined. The sequence is striking: a conservatory order, an appellate lift, a completed transaction and a subsequent annulment. The National Infrastructure Fund, built in part on proceeds from this sale, now faces a funding question layered on a legal one. Future divestitures involving state assets, banks or insurers will be structured with this sequence in mind, and with Asahi–EABL and Access–NBK as lived experiences. Public participation will need to begin earlier and run deeper. Valuation processes will need to visibly precede adviser engagement. Institutions will also need to internalise a simple lesson: a lifted injunction settles urgency, not legality.  

The courts have not closed the door on divestiture as a fiscal tool, nor have they slowed the pace of consolidation in banking or consumer goods. They have made clear that the door remains open only when the process behind it can withstand after-the-fact scrutiny, not merely at the point of sale.