Kenya on Monday launched the sale of a 65% stake in its state-owned Kenya Pipeline Company (KPC), aiming to raise 106.3 billion shillings ($825 million) in what would be East Africa’s largest initial public offering (IPO) in local-currency terms.
The divestment forms part of President William Ruto’s broader strategy to reduce government ownership in state enterprises as his administration grapples with heavy public debt, limited fiscal space, and debt repayments that consume about 40% of government revenues. The government is also in the process of cutting its stake in telecoms giant Safaricom.
Speaking at the IPO launch, Finance Minister John Mbadi said Kenya must adopt alternative funding approaches to sustain infrastructure and public services. “The traditional methods of financing our budget—taxation and debt—no longer offer any space,” he said, stressing the need for innovative financing mechanisms.
Initial Public Offering Details
According to the offer documents, the IPO is priced at nine shillings per share, with the sale running until February 19. Trading of the shares on the Nairobi Securities Exchange (NSE) is scheduled to begin on March 9. Kenyan investment bank Faida is acting as the lead transaction adviser.
Of the total stake on offer, 15% has been reserved for oil marketing companies, 5% for KPC employees, while the remaining shares will be allocated equally among local retail investors, local institutional investors, East African investors, and foreign investors, each receiving 20%. The government will retain a 35% stake in the company.
Market analysts expect strong demand for the offering. Eric Musau, head of research at Standard Investment Bank, said the accessible pricing should attract retail investors, while institutional players in the energy sector are also likely to show significant interest.
If fully subscribed, the KPC IPO will surpass the 2008 Safaricom IPO, which raised just over 50 billion shillings, making it the largest IPO in the region by local-currency value. However, in dollar terms, Safaricom’s offering may still rank higher due to the significant weakening of the Kenyan shilling over the past 17 years, according to LSEG data.
