Kenyan President William Ruto has defended Nigerian billionaire Aliko Dangote's acquisition of a major stake in Kenya Pipeline Company (KPC), after opposition criticism of the deal intensified. Speaking at a church service in Mwingi, Kitui County, on Sunday, 25 October, Ruto accused critics of opposing a transaction they had previously questioned on price, and warned his administration would not allow brokers to benefit at the expense of Kenyans.

Dangote acquired approximately 24.76 per cent of KPC for about Sh42.5 billion, or $327 million, in a block trade of about 4.5 billion shares on the Nairobi Securities Exchange. The purchase makes him the company's second-largest shareholder after the Kenyan government, which retains a 35 per cent stake.

A vote of confidence, or a transparency row?

Ruto described the private investment as a vote of confidence in Kenya's capital markets and a step towards mobilising private capital for strategic infrastructure. He also pointed to Dangote's planned $16 billion, 700,000-barrel-per-day refinery at Lamu, which broke ground in late September, as evidence of long-term commitment to Kenya's energy sector.

Critics, led by Kiharu MP Ndindi Nyoro, have questioned the transparency of the share sale and alleged it could pave the way for Dangote to gain majority control of the strategic petroleum company. Those allegations are disputed by the government, which defends the sale as a legitimate commercial transaction. Nyoro has also questioned the role of public institutions — including the National Social Security Fund — which bought KPC shares in this year's initial public offering and then sold them on.

What happens next

Ruto said Kenya aims to raise foreign direct investment from $3.2 billion this year to $5 billion next year. Whether the Dangote deal quiets the row or deepens it will depend on the disclosure critics are demanding.

Source: Reuters