The planned initial public offerings (IPOs) for Airtel Tanzania and Tigo Tanzania will have take longer than expected with reports emerging that shareholders of the two companies haven’t agreed on the number of shares to be listed before they can proceed with applications.
Tanzania Government last year passed a law compelling all mobile phone firms to offload 25 per cent of their shares on the Dar es Salaam Stock Exchange (DSE) to enable the citizens get a share of the the profits made by these companies.
According to The Citizen , it is only Vodacom Tanzania that has passed in several of the requirements while the skeleton prospectuses for Tigo and Airtel have not made any meaningful stride due to boardroom wavering among shareholders and they haven’t come into a conclusion on what chunk should be offloaded.
Data from the Tanzania Communications Regulatory Authority (TCRA) indicates that Tigo and Airtel have a market share of 29 and 26 per cent respectively while Vodacom leads with 31 per cent.
Tanzania government owns 40 per cent of Airtel Tanzania shares while the rest are owned by India’s Bharti Airtel.
“The two shareholders have not yet agreed on how many shares each party should offload to the public in the planned IPO,” a source was quoted by The Citizen.
On Sunday, President Magufuli met the founder and chairman for Bharti Enterprises, Indian billionaire Sunil Bharti Mittal, at the State House in Dar es Salaam. A statement from Airtel Tanzania noted that the two discussed Airtel’s business operations in Tanzania and Mr Mittal expressed his willingness to list Airtel on DSE.
Mobile phone firms risk being fined or having their network operating licences suspended if they fail to meet the mandatory listing requirement.
On Tigo, the source said. “With such challenges, it is impossible for capital market regulators to proceed with Tigo’s application and that is why the firm’s draft prospectus has not yet gone beyond that very initial level.”
Source; The Citizen