EXTREMELY SIMPLIFIED SAFARICOM/VODAFONE SHAREHOLDING STRUCTURE
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This is a very very simplified Diagram(some information is left out) drawn from information obtained from the Annual reports of Vodafone Plc. as at 31st March, 2004, 2005, 2006. However, its sufficient for illustrative purporses.
Between Vodafone Plc. and Mobitelea Ventures stake in Vodafone Kenya Ltd (VKL), there may be several holding Companies and legal entities (Special Purpose Vehicles). I have ignored this in the simplified chart.
The 87.5% and 12.5% refer to the assumed eventual holdings in VKL by Vodafone Plc. and Mobitelea Ventures through the various legal entities they control.
87.5% control of VKL translates into 35% effective interest of Safricom and 12.5% of VKL translates into 5% effective interest of Safaricom.
There are three facts you must keep in mind when looking at this chart:
1. According to Safaricom, the Shareholding is 60% Telkom Kenya Ltd (TKL) and 40% Vodafone (K) Ltd which is true.
2. According to Vodafone Plc. Annual Reports, they acquired 5% indirect interest in Safaricom from Mobitelea Ventures in 2003.NOTE; they said INDIRECT INTEREST not DIRECT interest. Meaning that Mobitelea Ventures has an indirect interest in Safaricom.i.e.they don’t directly own shares in Safaricom but in another company (VKL) that owns shares in Safaricom
3. The only way to have an indirect interest in Safaricom is through Vodafone Kenya Ltd (VKL). TKL’s stake is still the same as at the time of the Original Agreement in 2000.
Shareholder agreements are legal and still stand since the agreements are between TKL and VKL, not TKL and Vodafone Plc.
The aggrieved parties are Vodafone Plc’s shareholders. TKL isn’t since it agreed a 60:40 split of Safaricom and it still has 60%. Vodafone Plc. diluted its effective interest to 35% from 40%.
Why we are barking up the wrong tree.
The transactions are between Shareholders of VKL (it’s a Private Company), Vodafone Plc and Mobitelea Ventures.TKL, Safaricom Kenya Ltd are strangers to these transactions.
Therefore only the shareholders of the involved parties VKL, Vodafone Plc and Mobitelea Ventures can answer the questions or be aggrieved.
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