Thousands of employees at Telkom Kenya could lose their jobs as the government has threatened to withdraw the firm’s licence.

Communications Authority of Kenya (CA) CEO Ezra Chiloba says the State agency will not renew Telkom's licence owing to its huge debt burden amounting to Ksh.9.4 billion come next year when their licence expire.

The government’s decision to pull off property valued at Kshs10 billion from Telkom Kenya’s balance sheet without the knowledge of Helios Investment Partners, is what prompted the private equity fund to initiate its exit from the struggling telecommunications giant in 2021.

“What this means is that when Telkom comes under review for a new licence, which is due next year, most likely the authority will not grant that licence,” said the CA boss.

“The government of Kenya proceeded to unlawfully expropriate prime property of Telkom Kenya Limited situated along Ngong’ Road Nairobi measuring approximately 79 acres valued at over Kshs 10 billion without Telkom’s or Jamhuri Holding Ltd.’s consent and without any compensation being committed or paid”, the letter from Paul Cunningham dated March 20th, 2023, addressed to the Office of the Clerk of the National Assembly reads.

According to the letter, Telkom Kenya Ltd, the government of Kenya, and Jamhuri Holding Ltd lost $ 200 million (Sh 26.11billion) due to the failed joint venture with Airtel Kenya owing to the resources it had deployed in preparation for the aborted joint venture.

“There are major regulatory issues that we’re concerned about. When I talk about Ksh.9.4 billion, at the time we wrote the letter to National Treasury, it was Ksh.7.2 billion...but the data has since escalated.”

Chiloba said some service providers like the American Tower that leases towers to Telkom Kenya to operate could also pull out their services soon.

“If American Towers decides to shut down Telkom, it means the customers of Telkom Kenya will not be able to receive the service,” he noted.

Early in the day, Keiyo South Member of Parliament Gideon Kimaiyo revealed to the committee that there were already plans underway to sell all shares held by Jamhuri Holdings and the government of Kenya to another entity; claims that Telkom Kenya board Chair Edward Njoroge confirmed to the committee.

MPs accused the Telkom Board Chair of being used by the Mauritius and Cayman Islands-based Helios Company to micromanage the company in their favor.

This is besides the Kshs 6.1 billion that was paid due to the government taking up $ 51,186,058(Kshs 6.68 billion) worth of shareholder loans held by which is a special purpose vehicle set up by private equity fund, Helios, to invest in Telkom Kenya in June 2016.