- Feb 11, 2006
By JOSEPH MWAMUNYANGE
Source: Nation MediaMillions of Tanzanians will not be in the group buying shares in the most profitable company in East and Central Africa, Safaricom after the Bank of Tanzania refused to grant permission.
According to Bank of Tanzania Governor Prof Benno Ndulu it would be difficult to oversee such an undertaking given the current legislation.
Please be advised that the sought dispensation would be difficult to administer given the existing limitations on convertibility of our East African currencies, he said.
The central bank said that in any case, piecemeal waivers wouldnt address the fundamental issues on capital-account liberalisation, but rather undermine transparency and market development in general.
On this account, the BoT was unable to grant the sought approval but would like to work with all stakeholders in revising the policy framework governing such transactions, thus promoting integration of the East African markets in a sustainable manner, he added.
Prof Ndulu said that Safaricom had not made any commitment to cross list at the Dar es Salaam Stock Exchange (DSE), which denies Tanzania an opportunity for development of its national bourse.
Chief executive officer of Orbit Securities Laurian Malauri told The EastAfrican that the decision by the BoT would deprive Tanzanians of an opportunity to take part in the initial public offer of Safaricoms shares, through which the Kenyan government wants to offload 25 per cent of its holding in the firm.
Mr Malauri said that, given the fact that the price was at a discount of 14 per cent and thus affordable to a majority of Tanzanians at Ksh5 (Tsh95), they would miss a rare opportunity to participate in the most profitable company in East and Central Africa.
Orbit Securities was the sponsoring broker during the cross listing of Kenya Airways, East African Breweries Ltd and Jubilee Holdings.
Most Tanzanians didnt participate fully in these cross-listings because the shares were costly at the time of listing, he said.
Safaricom is to be listed on the Nairobi Stock Exchange on June 9, after the government offloads 25 per cent of its 60 per cent holding in Safaricom to raise Ksh50 billion ($793.65 million). UKs Vodafone holds the remaining 40 per cent of the firm.