- State has barred foreigners from Vodacom IPO participation
- Two unit trusts under formation as offer draws to a close
Two Tanzanian financial advisory firms are setting up mutual funds that will enable foreign investors to take part in Vodacom Tanzania Ltd.’s initial public offering, which is currently only open to domestic buyers.
The pair, Vervet Global and Orbit Securities Ltd., are following the lead taken by Core Securities Ltd. The offer for 476 billion shillings ($213 million) of shares in the mobile operator, a unit of Johannesburg-based Vodacom Group Ltd., ends in nine days.
“We already have one under way,” Alpha Marwa, a partner at Vervet Global, a Dar es Salaam-based investment advisory firm, said by phone. “What this instrument means is brokers will establish funds like Core Capital’s, bring in foreign investors who can then buy stocks.”
Foreigners are barred from participating in the Vodacom offering because of domestic ownership rules. The IPO is Tanzania’s biggest so far, and while the Capital Markets and Securities Authority is optimistic that domestic investors will absorb all of the shares, it may consider opening up the offer to foreigners if it’s undersubscribed, spokesman Charles Shirima said March 9.
Tanzania had eight mutual funds, including a real estate investment trust, at the end of March, according to Shirima. They include the Umande Unit Trust set up by Core Securities subsidiary Core Capital Ltd. in 2015. That instrument has become an avenue through which foreign investors are buying into Vodacom with a minimum 13,500-shilling investment,…