8 January 2018

Tanzania: Maxcom On the Threshold of IPO

A leading ICT integration firm in Tanzania, Maxcom Africa Limited, is currently in the final stages of preparing to submit its draft to the Capital Markets and Securities Authority (CMSA) for listing on the Dar es Salaam Stock Exchange (DSE). Mr Raphael Masumbuko - the chief executive officer of Zan Securities Limited, who are providing advisory services to Maxcom - told The Citizen that they were seriously considering February this year as the month in which to launch the company's initial public offering (IPO).

"We're considering February as the right time to open the IPO because the economy of the country (Tanzania) will be stable -and members of the public would have already finished dealing with their January financial obligations," he said, referring to the myriad expenses that are usually associated with the month of January such as rent, school fees, etc.

"Although it's not mandatory for Maxcom to launch an IPO, we nonetheless consider February to be the perfect time in which to start an IPO. We expect the company to be listed on the local bourse (DSE) by February or March this year," the Zan Securities chief stated.

Mr Masumbuko further explained that, apart from Maxcom, several companies have shown interest in listing on the DSE. However, he would not divulge their names or other details, ostensibly because "they were not yet ready for that kind of publicity."

Currently, Maxcom operates in six African countries, namely Tanzania - which hosts the firm's headquarters - Rwanda, Kenya, Uganda, Zambia and Burundi.

The firm's board chairman, Prof Samwel Wangwe of Tanzania, recently said that the listing would enable the company to freely operate in compliance with the country's laws and regulations.

According to the chairman, the application to go public was aimed at conforming with Tanzania's Electronic and Postal Communication Act of 2010, and the Finance Act (2016), which requires communications operators to offload a minimum of 25 per cent of their shares on the general public.

June last year, Tanzania President John Pombe Magufuli ordered the revocation of operation licences for mobile telephony companies which were not willing, able or ready to list with DSE.

In the event, Dr Magufuli directed the Tanzania Communications Regulatory Authority (TCRA) to act tough against stubborn companies - emphasizing that all mobile phone firms operating in the country were required to float shares on the bourse.

Maxcom chairman Wangwe said implementation of the president's directive would improve the company's efficiency.

In that regard, the good professor stressed that he would strive throughout his term to efficaciously manage the company, and expand its activities within and beyond the country's borders.

"Listing at the DSE will enhance" all that, Prof Wangwe confidently stated.


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