Kenya Sells 65% Stake in State Oil Pipeline Firm
Kenya has launched the sale of a 65% stake in its state-owned oil pipeline operator, aiming to raise 106.3 billion shillings (approximately $825 million) in what would become East Africa’s largest local-currency initial public offering (IPO).
The offering forms part of President William Ruto’s wider drive to divest from state-owned enterprises and ease pressure on public finances. The government is also reducing its stake in telecoms giant Safaricom, seeking alternative funding sources amid rising debt obligations.
Kenya’s public finances have been constrained by high debt, limited revenue-raising capacity, and debt servicing costs that consume roughly 40% of government revenue. Finance Minister John Mbadi stressed the need for new financing models, saying, “The traditional methods of financing our budget, taxation and debt, there is no longer any space. We must turn to innovative financing mechanisms to fund our infrastructure and public service projects.”
The IPO has been priced at nine shillings per share and will remain open until 19 February, with shares expected to begin trading on the Nairobi Securities Exchange on 9 March. Of the 65% stake on offer, 15% is reserved for oil marketing companies, 5% for employees, and the remaining 45% will be evenly distributed among local retail investors, local institutions, East African investors, and foreign investors. The government will retain a 35% shareholding after the listing.
Kenyan investment bank Faida is acting as lead transaction adviser. Analysts expect strong demand for the IPO, buoyed by recent gains in Kenyan equities, with the MSCI Kenya stocks index rising over 50% in the past year.
Eric Musau, head of research at Standard Investment Bank, noted: “While the accessible pricing is set to attract retail participation, we are also likely to see strong interest from institutional energy sector investors.”
The IPO is set to surpass the 2008 Safaricom listing, which raised just over 50 billion shillings, making it Kenya’s largest IPO in local currency terms. Globally, equity markets are recovering, with $738.4 billion raised through IPOs in 2025, up 15% from 2024. Africa recorded six IPOs last year, raising a combined $882.1 million, the highest total since 2018.
