The purchase of a 60% stake at Telkom Kenya by the government has been cancelled, according to a decision made by the Cabinet. The stake was valued at over Ksh.6 billion.
The government will now seek a refund of the said amount from Jamhuri Holdings and Helios Investment Limited for the buyout deal.
The Cabinet, chaired by President William Ruto, conveyed the decision in a communication to newsrooms after a meeting.
The Cabinet rescinded the decision for the Government of Kenya to purchase sixty per cent (60%) of the ordinary shares of Telkom Kenya from Jamhuri/Helios, citing governance challenges posed by the nationalization of Telkom Kenya Limited in the run-up to last year’s General Election.
Jamhuri/Helios will refund the Government of Kenya the amount paid as consideration for the takeover following the Cabinet’s decision.
The Cabinet’s intervention will enhance Telkom Kenya’s operational capacity and make it a competitive player in the telecommunications market, while also offering the company an opportunity to source and onboard another strategic investor, subject to the receipt of all regulatory approvals.
The investigation into the controversial buyout of Telkom Kenya in March this year took a twist after former Treasury Cabinet Secretary Ukur Yatani revealed that the government was the majority shareholder.
Yatani told a joint committee probing the buyout 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.
“However, the shareholding status had not been changed at the State law office since the Telkom Kenya board that was supposed to initiate the changes was not properly constituted, “he added.
Yatani revealed that the payment had been approved following a sitting by the National Security Advisory Council that wanted Telkom to be fully government-owned as it handles critical security installations, including the office of the President, State House, the Defence headquarters, the National Intelligence Service, as well as running the IFMIS portal.