Vodafone Group PLC announced earlier this month that its wholly owned subsidiary, Vodafone International Holdings B.V., has agreed to transfer part of its indirect shareholding in Safaricom Ltd. to Vodacom Group Ltd., its sub-Saharan African subsidiary.

Based on the agreed terms of the transaction, Vodafone will exchange a 35 percent indirect interest in Safaricom for 226.8 million new ordinary Vodacom shares, according to a press release.

The transaction, which has a value of 2,361 million euros ($2,648) based on Vodacom's closing share price on Friday, May 12, will increase Vodafone ownership in Vodacom from 65 percent to 70 percent. Vodafone will continue to hold a 5 percent indirect interest in Safaricom following the transfer in addition to the indirect interest held through Vodacom, the release said.

As part of the transaction, Vodafone Group has given appropriate assurances to the government of Kenya to support the ongoing success of the longstanding partnership between Safaricom, the wider Vodafone Group and the government of Kenya.

The transaction is expected to generate clear benefits for Safaricom, Vodacom and Vodafone Group:

• it allows Vodafone Group to streamline and simplify the management of its sub-Saharan African holdings;
• it strengthens alignment and cooperation between Safaricom and Vodacom and provides greater scope to share talent and expertise across the region and internationally; and
• it provides exposure for Vodacom to an attractive Kenyan market and one of the most successful and innovative telecoms companies in Africa, further enhancing its investment case and strategic position.