Standard Investment Bank says the National Treasury is selling its 15% stake in Safaricom at a 15.4% discount, based on comparisons of recent transactions of similar assets and the telco’s expected future earnings.
The transaction, announced last week, is priced at Sh34 per share. Under the deal, South Africa’s Vodacom Group will pay the government Sh204.3 billion for more than six billion shares. However, the investment bank values the company at Sh40 per share, a price that represents a higher premium compared to both the current market price and Vodacom’s offer.
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