Kenya’s biggest company by market value, Safaricom, appointed Peter Ndegwa as CEO from 1 April 2020, amid plans for regional expansion and rising competition at home.

Ndegwa currently oversees Diageo’s operations in 50 countries in Western and Eastern Europe, Russia, Middle East and North Africa, according to an e-mailed statement. He will take over from Michael Joseph, who’s been leading the US$11-billion company in an acting capacity following the death of former CEO Bob Collymore.

The Vodacom Group unit is scheduled to release first-half financial statements on 1 November. It halted a customer-losing streak in the second quarter, when its market share climbed to 63.5%, or 33.1 million subscribers, according to regulatory data. That was the first increase since September 2017 as competitors such as Bharti Airtel‘s local unit ratcheted up competition.

Ndegwa’s biggest headache might be fighting back attempts to declare the company a dominant industry player, which could result in it being broken up. A merger between Airtel Kenya and Telkom Kenya is also expected to create a bigger competitor for Safaricom.

The appointment “is largely positive because having a Kenyan CEO will go a long way in retiring the dominance debate at a time when we expect consolidation in the telecoms sector”, Tracy Kivunyu, a senior telecommunications analyst at Tellimer, said by phone from the capital, Nairobi.

Regional footprint

Further afield, the man credited with developing an affordable-beer strategy for Diageo’s East African Breweries will likely be tasked with growing Safaricom’s regional footprint. The operator has already indicated it’s eyeing northern neighbour Ethiopia, which is expected to issue licences to competition after liberalising its state-owned monopoly from next year. Former CEO Collymore said Safaricom would expand into Ethiopia with an e-commerce platform, while Joseph is reported as saying the company would be keen on acquiring a stake in Ethiopian Telecommunications.

“His experience in consumer business will be very relevant in the direction the telecoms business is going,” said Silha Rasugu, an equities analyst at EFG-Hermes Kenya. You’re pricing products to match very targeted customer segments so there’s an element of very targeted marketing. Operating the Diageo business across multiple geographies is also a positive considering the direction Safaricom wants to go.”