DAR ES SALAAM (Reuters) - Vodacom Tanzania Plc, a subsidiary of South Africa's Vodacom Group (J:VODJ), has extended the offer period for its initial public offering by three weeks to give local investors more time to take part in the share sale, an official from the market regulator said on Wednesday.
The company's plan to raise 476 billion shillings by selling 560 million shares at 850 shillings each is Tanzania's biggest ever share sale. The IPO is only open to local investors, though foreign investors can take part in the secondary market.
The offer period, which was initially scheduled to end on Wednesday, will now run to May 11 and the market listing is likely to take place on June 6, Charles Shirima, a spokesman for the Capital Markets and Securities Authority (CMSA), said.
"The extension of the IPO is nothing unusual ... it is aimed at giving Tanzanians more time to take part in the share sale," Shirima told Reuters.
Analysts said the extension of Vodacom's IPO period followed a late surge in demand for shares from domestic retail investors.
"There has been a huge demand for the shares as we approached the last days of the IPO period and many investors called for an extension of the IPO," Juventus Simon, general manager of Orbit Securities, told Reuters.
The country's eight telecom operators are required by law to have 25 percent local ownership via a stock market listing. The government hopes the listings will bring more transparency and offer the public a share in the industry's profits. Telecommunications is one of the fastest-growing sectors in the country.
Tanzania, east Africa's second-biggest economy, posted a 0.9 percent annual increase in the number of mobile phone subscribers in 2016 to 40.17 million.
As in other African countries, mobile phone use has surged in Tanzania over the past decade, helped by the launch of cheaper smartphones.
The other two major operators, Millicom (ST:MICsdb) subsidiary Tigo and a local unit of India's Bharti Airtel (NS:BRTI), have also submitted their prospectuses to the capital markets regulator for IPOs to comply with mandatory listing regulations, according to the CMSA.
Orbit Securities Company Limited is the lead transaction adviser for Vodacom Tanzania's IPO while National Bank of Commerce Ltd is the lead receiving bank, according to the Vodacom Tanzania IPO prospectus.
Vodacom is 65 percent owned by mobile phone group Vodafone (L:VOD), according to its website.