Microsoft-G42 Kenya data centre stalls over government offtake demands

The company asked the Kenyan government for a guaranteed annual capacity offtake. The government did not commit at the level Microsoft requested. Talks have broken down for now; the project is not formally cancelled.

A $1bn Microsoft data-centre project in Kenya, structured as a partnership with UAE-based G42, has stalled after the two companies failed to agree on commercial terms with the Kenyan government, Bloomberg reported on Saturday.

The sticking point is offtake. Microsoft asked Nairobi for a guarantee that Kenyan public bodies would buy a defined amount of computing capacity each year. The government did not commit at the level Microsoft requested. Talks broke down.

The project was announced in May 2024 and structured as a flagship of Microsoft’s East Africa expansion: a geothermal-powered facility supplying Azure to government, enterprise, and developer customers across the region, with G42 as a strategic co-investor.

The $1bn budget was split between ...