This archive report was first published on 9 July 2020.
Published on July 9, 2020, Safaricom PLC, Kenya's largest telco, has diversified its business by acquiring a stake in UK gas firm Circle Gas Limited for Sh384.6 million.
The acquisition marks Safaricom's entry into the cooking energy business, a move aimed at exploring multiple revenue streams beyond voice business.
According to Safaricom's latest annual report, the company completed the transaction in December, acquiring an 18.96% stake in the England-based firm.
The telco had already been working with a Circle Gas Ltd subsidiary, M-Gas, since January, launching a prepaid cooking gas service to improve access to cooking gas for low-income communities.
Through its Narrow Band (NB) IoT network, Safaricom delivered a smart meter to monitor payments and usage of the gas.
“Strategically, the investment in Circle Gas solution is a digital service offering leveraging internet-of-things (IoT) and M-Pesa, that will drive our ambition to be the leading digital services provider in Kenya,” states Safaricom.
The investment is expected to bring profit while offering customers an affordable, clean energy source for cooking.
Circle Gas will also use Safaricom's trademarks in return for a royalty fee, providing additional income for the telco.
Notably, Safaricom and its South African parent company Vodacom recently acquired M-Pesa from British firm Vodafone at Sh2.146 billion, with each company getting a 50% stake.
