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Tanzania allows overseas bidding for share listings

Tanzania allows overseas bidding for share listings

Tanzania’s telecom authorities have opened up telecom operator listings to foreign firms following weak showings from domestic-only IPOs.

Finance minister Philip Mpango said that shares would be made available to “Tanzanians, Tanzanian companies, Tanzania in the diaspora, joint ventures between Tanzanians and foreigners, East Africans or companies owned by East Africans, or citizens from other countries”.

The decision was likely prompted by the notably weak local demand witnessed during the IPO of Vodacom Tanzania. Vodacom has not yet revealed the results of the offering, which has led to delays. Millicom is also pushing for an IPO of its Tigo Tanzania unit.

The country has been attempting to increase local ownership of domestic telecoms companies by encouraging them to list at least 25% of their shares on the Dar Es Salaam bourse. However, since the number of potential domestic investors is fairly limited, supply of operator shares is expected to outstrip demand.

The revised IPO guidelines will preclude smaller players from listing, as only companies with network facilities and services may do so.

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