US firm pushes to liquidate Telkom Kenya in Sh10b site fees row
Courts
By
Kamau Muthoni
| Nov 29, 2025
State-owned Telkom Kenya is locked in a high-stakes court battle with American Towers Corporation (ATC) after the US firm demanded Sh10 billion in outstanding site fees and initiated insolvency proceedings to liquidate the Kenyan operator.
ATC has filed an insolvency notice demanding Telkom pay the amount within 21 days for the provision of telecommunication infrastructure services.
ATC’s head of legal, Mark Lawi, claimed in an affidavit that Telkom had admitted to owing the disputed amount in 2023.
He argued the debt has continued to accumulate, with invoices outstanding for over three years—far exceeding the contractual 30-day payment period.
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"Applicant's failure to pay invoices outstanding for over three years ... is clearly an indication that the Applicant is unable to satisfy its liabilities and is only seeking to defer the payment of its obligations once again despite knowing that it is unable to pay its debts,” Lawi argued in court.
However, Telkom, in its reply, claimed the demand was premature. CEO Mugo Kibati told the court that both parties had previously signed a consent agreement before Commercial Court Judge Wayua Mongare in February this year to mediate the dispute.
Kibati noted that ATC's latest demand, issued on October 2, 2024, ignored this agreed-upon mediation process.
Kibati detailed the history of the agreement: In 2018, Telkom sold and transferred all of its passive infrastructure sites to ATC, with an agreement that ATC would license the sites back to Telkom for its use, while ensuring the provision of power, maintenance, and repairs.
Telkom sealed similar deals with Kenya Towers Ltd (later Eaton Towers Kenya) and Essar Telecom Kenya Ltd.
According to Kibati, ATC subsequently breached the contract by failing to supply regular power to the sites, resulting in significant revenue losses for Telkom.
“In breach of tower agreements, ATC irregularly disconnected powers to Telkom’s infrastructure, thereby undermining Telkom’s business and operations,” Kibati claimed.
He stated that despite the alleged breach, Telkom allowed ATC to offset $14 million (Sh1.8 billion) from the initial site sale amount.
Kibati argued that the current demand includes erroneous energy escalation costs and that the full amount requires investigation. He also maintained that the insolvency notice was defective as the case should have been handled through mediation first.
In his response, Lawi countered that the sites were disconnected because Telkom allegedly failed to pay electricity bills.
He argued that the demand represented a new issue, not covered by previous court settlements, and that the debt and penalties were continuing to accumulate. He urged the court to dismiss Telkom’s claims and allow ATC to file a case to liquidate the company.