The government has appealed a High Court decision that nullified its sale of 15 per cent of Safaricom PLC. The transaction was valued at Ksh 204.3 billion and involved more than six billion ordinary shares.
Attorney General Dorcas Oduor and National Treasury Cabinet Secretary John Mbadi are challenging the judgment. They want the Court of Appeal to quash the decision and suspend its implementation pending the appeal.
The two officials filed separate affidavits on September 17, setting out the government's position. They argue that the Ksh 204.3 billion received from the transaction cannot simply be refunded.
The government also says the disputed shares have already changed ownership. They were transferred to Vodafone Kenya Limited and remain quoted securities in Safaricom.
The shares were held and transferred through the Central Depository and Settlement Corporation. The government says reversing that transfer could create complex financial and operational consequences for all parties.
The State further argues that the transaction involved Ksh 40.2 billion linked to future dividend rights. That payment forms part of the wider financial arrangements surrounding the Safaricom divestiture.
The government has filed a 190 page petition at the Court of Appeal. It argues that restoring the shares without ordering repayment could leave the transaction financially unbalanced.
The State is also seeking a stay because the High Court orders could take effect before the appeal is heard. It says reversing those steps later could prove difficult or impossible.
The government argues that the case has wider implications for fiscal planning and Kenya's capital markets. It also points to investor confidence and the country's external financial position.
The High Court ruling followed a constitutional challenge to the government's partial divestiture. A three judge bench declared the transaction null and void and ordered restoration of the shares.
The government has expressed dissatisfaction with the entire judgment and already lodged its Notice of Appeal. The latest application therefore seeks to preserve the existing position until the appellate court considers the dispute.
Respondents, including businessman Tony Gachoka and Professor Frederick Onyango Ogola, must file replying affidavits before the next stage. The Court of Appeal will then set a mention date before hearing the application.
The dispute leaves the Ksh 204.3 billion transaction subject to further judicial determination. The outcome will also determine how the transferred Safaricom shares and related payments are ultimately treated.
