Kenya’s Communications Authority has shot down speculation that it planned to break up Safaricom.
Although a report commissioned by the CA recommended separating the operator’s M-Pesa unit from its telecoms business, the authority’s chairman Ben Gituku confirmed that it had no intentions of following this advice.
“I wish to allay fears that the authority is planning to split the business of some market players or take such drastic actions that may destabilise dominant market players,” said Gituku.
The suggestion was made by analyst firm Analysys Mason in a report that looked into competition in the Kenyan market. While the report is currently being analysed by the regulator, a draft version was leaked last month containing the suggestion about separating M-Pesa from Safaricom.
Safaricom is by far Kenya’s most dominant player in both wireless and mobile payments. A break-up of its telecoms and payments units had seemed likely, due to both the leaked report and proposals from Kenyan national assembly member Jakoyo Midiwo to bring about the separation.
However, Kenya’s ICT Minister Joe Mucheru lent his support to Gituku, saying that breaking up Safaricom would deter investors and “punish operators for innovation”.