Transaction designed to simplify management of its sub-Saharan Africa businesses.

Vodafone on Monday transferred a 35% indirect stake in its Kenyan arm Safaricom to its Vodacom unit, upping its stake in the South African operator to 70% from 65%.

Under the transaction, Vodafone will receive 226.8 million new ordinary Vodacom shares, valued at €2.36 billion based on Vodacom’s closing share price last Friday. Vodafone will continue to hold a 40% indirect stake in Safaricom, 35% via Vodacom, and 5% via its wholly-owned subsidiary, Vodafone Kenya.

"Vodafone Group has given appropriate assurances to the government of Kenya to ensure the ongoing success of the long standing partnership between Safaricom, the wider Vodafone Group, and the government of Kenya," said Vodafone in a statement.

The U.K.-based telco said the stake transfer will streamline and simplify the management of its sub-Saharan African holdings. It will also strengthen the alignment between Safaricom and Vodacom, providing "greater scope to share talent and expertise across the region as well as internationally."

Furthermore, the deal means now owns a 35% indirect stake in Safaricom, gaining "exposure to the attractive Kenyan market and one of the most successful and innovative telecoms companies in Africa," Vodafone said.

The deal is subject to approval by authorities in Kenya and South Africa, as well as Vodacom’s minority shareholders. The transaction is expected to complete during the third quarter.