Millicom International Cellular’s Tanzania unit, Tigo, has announced that it will list on the Dar es Salaam Stock Exchange by the end of June, after fulfilling the listing requirements.
The company had started the listing process in compliance with the Electronic and Postal Act of 2010 in 2017, which requires telcos to list 25 per cent of their shares on the bourse.
However, it was delayed by a legal dispute over ownership, which was only decided late last year.
“We are working closely with the regulatory bodies and conducting the necessary discussions to ensure we can successfully change from a private limited company to a public entity by the end of June,” said Umi Mtiro, Tigo's internal communication manager. “Tigo Tanzania will offload 25 per cent stake as the law requires.”
No specific date
The Capital Markets and Securities Authority (CMSA) said the firm has submitted its prospectus.
“It won’t take long for Tigo to go public, although I do not have a specific date yet,” said Charles Shirima, CMSA chief executive officer.
The Court of Appeal settled the dispute between Golden Globe International Services and Quality Group of Tanzania, who claimed to have acquired 34,479 shares in Tigo Tanzania’s holding company, MIC Tanzania Ltd, in 2014.
The court declared that MIC owns Tigo Tanzania, paving the way for its plan to go public, which had stalled since 2017.
The dispute was brought against Millicom by Golden Globe International Services Ltd and Quality Group Ltd, both companies’ majority share owned by businessman Yusuph Manji. The companies alleged that in 2014 they acquired the shares in Tigo Tanzania’s holding company MIC Tanzania Ltd.
This would have meant that the two companies owned 99 per cent of the business between them.
The Court of Appeal of Tanzania ruled that Millicom was Tigo Tanzania’s legal full owner, noting that it had genuine cause to dispute the claims, and declared the share purchase by Golden Globe and Quality Group to be null and void.
For nearly two years, the government has been battling with mobile phone firms over adherence to the Electronic and Postal Communications Act, which requires them to float at least 25 per cent of their shares on the DSE, ensuring local ownership and effective tax collection.
Market leader Vodacom Tanzania was the first telecom to go public, having concluded its IPO last year with 60 per cent Tanzanians and 40 per cent foreign investors.
The South African firm raised $231 million in its IPO. Vodacom floated 560 million ordinary shares, accounting for 25 per cent stake in the company, traded at a price of Tshs 850 ($0.4) per share.
According to June 2018 data, Tigo is the second largest telecom in the country, with 29 per cent of the market. Vodacom leads at 32 per cent.
Tigo had 12,583,640 subscribers as at December 2018, and 7,586,240 mobile money subscribers (32 per cent).
Vodacom Tanzania is leading with 39 per cent of the mobile money market with 9,014,088 subscribers.
Tigo is in the final stages of acquiring an additional stake in Zanzibar Telecom (Zantel) from the United Arab Emirates’ Etisalat Group.
Currently, Tigo Tanzania has an 85 per cent stake in Zantel, which it acquired three and half years ago.
Zantel has 1,153,641 phone users, and 546,353 mobile money subscribers, according to TCRA December 2018 communication statistics data.