The Kenyan government has launched the sale of a 65% stake in the Kenya Pipeline Company, aiming to raise approximately 106.3 billion Kenyan shillings (around US$825 million) in what is expected to be East Africa’s largest local-currency initial public offering. The move is part of President William Ruto’s broader plan to reduce state ownership in public enterprises, following earlier privatization efforts such as the partial listing of Safaricom.
Shares have been priced at 9 shillings each, with the subscription period open until February 19 and trading scheduled to begin on March 9 on the Nairobi Securities Exchange. The allocation reserves 15% of shares for oil marketing companies and 5% for employees, while the remaining shares are evenly distributed among local retail investors, local institutions, East African investors, and foreign investors. The government will retain a 35% stake, with Faida Investment Bank acting as lead transaction adviser.
Kenya Pipeline operates fuel pipelines, storage, and distribution infrastructure linking the port of Mombasa to Nairobi and inland markets, making it central to the region’s energy supply. The IPO represents a significant step in Kenya’s efforts to deepen capital markets and reduce state involvement in commercial assets. With its stable cash flows tied to fuel demand, the company is expected to appeal to pension funds, insurers, and energy-focused investors seeking predictable returns. A successful listing could boost liquidity on the Nairobi Securities Exchange and set a benchmark for future privatizations, while any setbacks might raise concerns about market depth, valuation, and investor appetite in a high-interest-rate environment.
