Safaricom shareholders to vote on Vodacom's CEO powers — Bob Collymore – image c/o Safaricom

Shareholders of Kenyan telecommunications firm Safaricom are due to vote on whether to give Vodafone Kenya the right to nominate the company’s CEO once it holds more than 50% of Safaricom’s shares, Safaricom said on Wednesday.

Vodacom, which held an effective 39.9% of Safaricom through its majority-owned subsidiary Vodafone Kenya, agreed in December to buy the Kenyan government’s 15% stake for about US$1.6-billion, a deal that lifted the holding to 55%. The government’s stake fell to 20%, while the public holds the rest of the shares, which are listed on the Nairobi Securities Exchange. The share acquisition was completed on 30 June.

The CEO is to be appointed from a list of nominees provided by Vodafone Kenya while it holds more than 50% of Safaricom’s issued share capital, Safaricom said in a notice announcing its AGM, which is due to be held on 31 July.

The proposed amendment also directs Safaricom’s board to encourage “a predominantly Kenyan character” in the company’s senior management and executive committee.

The board minimum is set at seven directors with no maximum, and both Vodafone Kenya and the government are entitled to appoint one director per complete 10% shareholding.