Dangote buys 25pc of Kenya Pipeline for Sh42.5b
Business
By
Brian Ngugi
| Oct 22, 2026
Africa's richest man, Aliko Dangote, has acquired a 25 per cent stake in Kenya Pipeline Company (KPC) for about Sh42.5 billion, extending his reach into the region’s fuel distribution network in a deal that places him at the centre of Kenya's long-delayed oil production ambitions.
Dangote, founder and chief executive of Dangote Industries Ltd, disclosed the deal at an event in London on Wednesday, according to Bloomberg.
He did not say which of his companies made the purchase. "We bought 25 per cent of their pipeline network for the distribution of petroleum products," he said.
A report from the Nairobi Securities Exchange (NSE) on Monday showed a block transaction in KPC of about 4.5 billion shares, valued at Sh42.5 billion.
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The company's market valuation is about Sh163.9 billion. The stake amounts to 24.76 per cent of KPC's issued shares, just below the 25 per cent threshold that would have triggered a mandatory takeover process under Kenyan capital markets rules.
KPC moves petroleum products from the port of Mombasa to inland markets. Its pipeline network runs about 1,342 kilometres and can handle an estimated 14 billion litres of products a year. It also supplies other East African countries.
The purchase follows Dangote's $16 billion (Sh2 trillion) refinery project in Lamu, which is modelled on his 700,000-barrel-per-day refinery in Lagos, Nigeria.
Construction formally began on September 30, with completion targeted around 2030. The project is expected to cost between $16 billion and $17 billion (Sh2.208 trillion).
The shares were reportedly sold by State-linked institutions that had bought into KPC during its initial public offering earlier this year.
The National Social Security Fund, Public Service Superannuation Scheme, County Workers Pension Fund and Unclaimed Financial Assets Authority were among the major domestic buyers.
The Kenyan government retained a 35 per cent stake following the IPO, while Uganda National Oil Company holds 20.15 per cent.
The transaction has drawn political scrutiny.
Kiharu MP Ndindi Nyoro described the transaction as a 'sweetheart deal' between the Kenyan presidency and a private investor, allegations the Treasury has denied.
Nyoro, who was suspended from Parliament this month after refusing to retract allegations about the KPC share sale, renewed his claims on Wednesday that public institutions sold the shares at a loss after presidential pressure.
He alleged that the shares were sold cum dividend, meaning the buyer would also benefit from the attached dividend, and that the exit price of between Sh9.02 and Sh9.36 per share left pensioners worse off after brokerage commissions.
He also linked the transaction to the Lamu refinery, alleging that the investment agreement contains provisions that could restrict Kenya from importing products made by the refinery even when prices are higher than market rates.
Treasury Cabinet Secretary John Mbadi has previously rejected claims that President William Ruto holds shares in the refinery.
President Ruto, speaking at the Mashujaa Day celebrations in Eldoret on Tuesday, defended the transaction as a sign of investor confidence.
"Private investors acquired a 25 per cent stake in Kenya Pipeline Company from public entities, marking another step towards mobilising private capital for strategic infrastructure," he said.
The Standard could not immediately reach Treasury or Dangote or his representatives for comment by press time.
KPC reported a 13 per cent increase in net profit to Sh11.58 billion for the financial year ended June 2026, and its board recommended a dividend of Sh5.81 billion.
For Dangote, the KPC stake completes a vertical integration strategy in East Africa, analysts say.
These include refining capacity through the Lamu project, and distribution infrastructure through the pipeline network that carries fuel from the coast to inland markets and neighbouring countries.