President William Ruto has revealed that the Kenyan government will divest a portion of its stake in the Kenya Pipeline Company (KPC) and pursue its listing on the Nairobi Securities Exchange (NSE) before September this year.
The announcement, made during a bell-ringing ceremony on July 2 at the London Stock Exchange, marks a critical step in the administration’s wider agenda to privatise state-owned enterprises and bolster domestic capital markets.
Ruto emphasised that the government will sell part of its holding in KPC through an Initial Public Offering (IPO), drawing on rising global interest following reforms in the NSE. “We are committed to a structured, time‑sensitive programme that identifies and prepares a robust pipeline of key government assets to be privatised or improved through private sector participation,” he stated.
Once listed, KPC will join other major parastatals such as KenGen, Kenya Power, and Kenya Reinsurance, offering Kenyans and foreign investors an opportunity to own shares in the strategic petroleum infrastructure provider.
The move follows a surge in KPC’s profitability. In the fiscal year ending June 2024, the company reported a before-tax profit of approximately Ksh10 billion a substantial increase from the prior year and paid Ksh10.5 billion in dividends to the Treasury.
Treasury Cabinet Secretary John Mbadi previously endorsed the listing, highlighting its potential to inject capital into KPC, support expansion into LPG and regional petroleum trading hubs, and allow ordinary Kenyans to directly invest in the infrastructure asset.
The NSE welcomed the announcement, citing its alignment with the “Bottom-Up Economic Transformation Agenda” and its potential to deepen capital market participation and investor confidence.
Analysts and government officials agree that opening up KPC’s ownership structure could enhance transparency, improve governance, and reduce Kenya’s reliance on external borrowing by mobilising local savings.
This move has gained particular urgency in the aftermath of nationwide protests that forced the government to rescind proposed tax hikes valued at Ksh346 billion. Ruto framed the drive as part of a strategic pivot toward self-reliance and domestic revenue generation in the wake of diminishing external support, including potential cuts in USAID funding.
Critics caution that the success of this initiative will hinge on the government adhering to due-process safeguards, including Parliamentary and Cabinet approvals under the Privatisation Act 2023, and ensuring that asset sales genuinely serve public interest.
Investors and civil society will closely monitor the valuation process, share allocation mechanisms, and the extent to which promised proceeds are reinvested into public infrastructure.
As the government moves toward the September deadline, attention will shift to regulatory clearances, the distribution of KPC shares, and the company’s governance structure post-listing.
With KPC playing a pivotal role in petroleum transportation across Kenya and neighboring countries, its IPO could shape the trajectory of Kenya’s financial markets and state-owned enterprise reform for years to come.
Written by Ian Maleve
