1 March 2017

Tanzania: Vodacom's Share Sale Set for This Month

Photo: The Citizen
Vodacom building in Tanzania.http://allafrica.com/view/resource/main/main/id/00110278.html

Dar es Salaam — The Capital Markets and Securities Authority (CMSA) has given Vodacom Tanzania the go-ahead to sell its shares to the public later this month.

CMSA Public Relations Officer Charles Shirima confirmed to The Citizen yesterday that the authority approved Vodacom's prospectus on Monday, paving the way for the firm's initial public offer (IPO) at the Dar es Salaam Stock Exchange (DSE).

"What I can say is that we have endorsed Vodacom's IPO. I cannot reveal details of what is in the prospectus because the rules and regulations don't allow me to do that," he said.

A senior official of the lead manager, Orbit Securities Limited, told The Citizen that the IPO would start within two weeks.

"It's 'all systems go'. We received the approval letter on Monday and will later today (yesterday) meet with the issuer (Vodacom) to consult on some details. We expect the IPO to start in the next two weeks. By tomorrow (today) we might be able to announce the exact date of the IPO," Orbit Securities General Manager Simon Juventus said.

He added that the logistics of printing and distributing copies of the prospectus nationwide were being sorted out.

"Tanzania is a big country. We have to print enough copies of the prospectus for distribution countrywide before we can hold the IPO."

Vodacom Tanzania Managing Director Ian Ferrao also confirmed the development.

"Vodacom Tanzania confirms that the Capital Markets and Securities Authority (CMSA) has approved Vodacom Tanzania Plc's prospectus ahead of its Initial Public Offer (IPO) and subsequent listing of 25 per cent of its shares on the Dar es Salaam Stock Exchange (DSE)," he said in a statement yesterday.

Mr Ferrao added that Vodacom plans to raise Sh476 billion ($226 million) by selling 560 million shares at Sh850 per share.

The IPO is expected to raise the biggest sum in the history of capital markets in the country, breaking the record set when the East Africa Breweries Limited (EABL) IPO raked in Sh122 billion after offering 20 per cent of its shares in 2012.

The National Microfinance Bank IPO raised Sh63 billion in 2008 when the equivalent of 42 per cent of the lender was sold through DSE.

Upon listing at the DSE, Vodacom Tanzania will boost DSE's market capitalisation by 2.4 per cent to about Sh20.6 trillion, according to an analysis conducted by Bloomberg News Agency based on data from the bourse.

Vodacom, with a 31 per cent market share of the mobile market in the country, becomes the first telecoms firm to qualify to sell its shares to the public as required by the Electronic and Postal Communications Act (Epoca), 2010 as amended in 2016. The Act gave mobile telephone companies until December 31, 2016 to sell at least 25 per cent of their shares to the public.

Other companies that sought to comply with Epoca are Millicom International Cellular SA (Tigo) and Bharti Airtel Ltd.

However, their applications have stalled. Tigo is embroiled in an ownership dispute in court, while Airtel has some issues to sort out with regard to its prospectus.

Mr Shirima said yesterday that Airtel was yet to submit a revised prospectus.

Tanzania Telecommunications Company Limited has yet to submit its application to CMSA.

Tanzania

Remembering Country's 'Foremost Elephant Specialist'

If elephants were humans, then they would be mourning for the death of a person who has been fighting for their… Read more »

Copyright © 2017 The Citizen. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.

AllAfrica publishes around 800 reports a day from more than 140 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.