Safaricom CEO plans exit this year

Safaricom’s chief executive officer, Michael Joseph, plans to step down in 2010 after a decade at the helm, during which he turned the telecommunication company into East Africa’s biggest company by market capitalisation and profit numbers.

“I am planning to retire sometime in 2010, that’s my intention,” Michael Joseph told Reuters in an interview on Thursday.

Mr Joseph said he had intended to leave Safaricom last year, but the timing was not right.

The prospectus for the Sh5 billion bond listed last November indicated that Mr Joseph and Safaricom’s chief investor relations officer, Mr Leslie Baillie, would be eligible for retirement within the two years from the day the first tranche got listed— meaning November 2011.

However, by October last year, no conclusions were given on his retirement plans when preparations for listing of the first tranche of the bond were in top gear.

Mr Joseph who started out as a telecommunications technician over 40 years ago has steered the company to new heights with the firms’s shares now accounting for more than half of those traded each day at the Nairobi Stock Exchange.

The company’s revenue has also grown substantially over the years, thanks to increased mobile phone use with the launch of services like M-pesa.

Mr Joseph also told Reuters he expects 25 per cent of the firm’s revenue to come from data services within two years as the number of mobile Internet users and subscribers to Safaricom’s money transfer service, M-pesa, continue to increase.

Mr Joseph also successfully steered the company through an initial public offering (IPO) in 2008.

He has led the company into growing its business to the point where it required an injection of new working capital through the bond to be able to carry out its planned projects.

The bond was a success as it was oversubscribed.

The assurance in the prospectus that he would stay on as chief executive for the following two years bolstered support for the subscription of the bond offer, analysts said

He has been seen as the critical figure in the phenomenal growth that the company has undergone from the backwater of telecommunications in the country as a mere department at Telkom Kenya to the largest profit-making machine in the region, embracing new ideas in a fast-changing environment.

As the CEO plans his exit strategy, challenges await the company’s board on who to pick as his successor as the company has been closely associated with the CEO.