A number of analysts have placed the value of Safaricom in a range of Sh150 billion to Sh180 billion. Vodafone UK holds 40% of Safaricom, but has offered US$ 100 million (Sh7.7 billion under current exchange rates) for the additional 11% cent currently held by Telkom Kenya. The offer implies that Vodafone puts the company's value at Sh77 billion (US$ 1 billion), which the Government believes is too low. A valuation by Dyer & Blair Investment Bank, put the company's value at Sh172.5 billion (US$ 2.3 billion).

Other African telecommunications providers, such as MTN, could be willing to offer Kenya much more than Vodafone to purchase Safaricom, which recently reported pre-tax profits of Sh8.4 billion on revenues of Sh26 billion, making it the most profitable company in Kenya.

Dyer and Blair's valuation sought to value Safaricom’s subscriber base based on acquisition transactions of similar firms in Africa. In this case, the analysts used the recent sale of Kencell to Celtel and the acquisition of Celtel International by Kuwait's MTC. The investment bank gave "a back of the envelope" value of each Safaricom subscriber in Kenya at US$ 1,000, and this resulted in Safaricom's 2.5 million subscriber base being valued at US$ 2.5 billion. Based on projected earnings for Safaricom, the market value would be US$ 2.3 billion dollars. Analysts, however, cautioned that this was not an authoritative valuation based on an exhaustive audit.

Source: The Nation - WDR/Intelecon Regulatory News