THE Capital Markets and Securities Authority
(CMSA) has approved Vodacom Tanzania Prospectus, paving way for 476bn/- initial
public offer (IPO), which is the biggest in the history of the Dar es Salaam
Stock Exchange (DSE).
The approval
makes Vodacom Tanzania the first telecoms company to list on the DSE. “We
approved the prospectus on Monday… the sponsoring brokerage firm has all the
IPO and listing details,” CMSA Principal Public Relation Officer, Charles
Shirima told ‘Daily News’ yesterday.
According to the
law, Vodacom was required to offload 25 per cent stake to the public. The long
waited IPO, putting 560 million shares onto the market at 850/- a unit, is
predicted of oversubscription as the firm markets itself.
The IPO will take
six weeks from starting date. Orbit Securities Managing Director, Juventus
Simon said yesterday that there were minor details to be corrected on the
prospectus before sharing to the public.
“We will be in a
position of sharing the prospectus in about three or four days after making
minor corrections… bear with us at the moment,” Mr Simon said.
Vodacom controls
a bigger stake of 31 per cent in the country’s telecoms market with some 12.4
million active subscribers by the end of last year. The country had over 40
million tele-subscribers by the end of 2016.
Zan Securities
Chief Executive Officer, Raphael Masumbuko said would-beinvestors were waiting
for the IPO since the telecom Act was passed.“People
from all walks of life are waiting for this IPO.We
have been in constant pressure as to when Vodacom IPO will come out.
The firm
self-sales since it’s a household name,” Mr Masumbuko said. The CEO said in the
two decades of DSE history, no good firm has been undersubscribed because
buyers failed to purchase shares after running out of money.
“This has never
happened and I don’t think it will happen this time around. The IPO will be
oversubscribed. “Actually, you don’t even need a prospectus to sell Vodacom as
social assumption is, it’s a well profitable firm (and I think it is),” Mr
Masumbuko said.
The main sources
of income for Vodacom are voice, data and money transaction via M-Pesa. The
firm is the market leader in all those fronts — controls 31 per cent in voice
business and 42 per cent of mobile money transaction.
DSE Insight made
a hypothesis poll on twitter at the beginning of this year, tried to find out
if the IPOs of three telecoms were held today, which one would attract more
buyers. The poll results showed that 71 per cent will go for Vodacom, 21 Tigo
and 8.0 Airtel. DSE Insight does not belong to DSE.
In recent days,
the market was performing badly as investors were believed to hold their funds
awaiting Vodacom IPO, sending the bourse into a bearish rally in the first
seven weeks of this year.
The Tanzania
Stocks Index (TSI), capturing 18 equities, dropped by negative 8.07 per cent to
3,380.25 points in a month and half since January. DSE CEO, Mr Moremi Marwa
said there was a possibility people were reserving and hence halting secondary
market for currently listed in favour of the upcoming Vodacom IPO.
“I meet many people
who indicate that they are waiting for Vodacom,” Mr Marwa said. CMSA said they
were still working with Airtel prospectus while they have returned Tigo
documents asking them to correct some details especially the shareholding
issue.
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