Rostam Aziz exits Vodacom Tanzania

Dar es Salaam. Tanzanian billionaire Rostam Aziz is in the process of offloading his remaining shares in Vodacom Tanzania.

According to reliable sources, South Africa’s Vodacom Group is targeting the businessman’s 26.25 per cent stake in its subsidiary.

The shares are currently owned by Mirambo Limited, Mr Aziz’s non-trading investment company that is incorporated in Tanzania, but which is owned by East Africa Investment (Mauritius) Limited, a company incorporated in the Republic of Seychelles.

A Fair Competition Commission (FCC) published a notice last month showing that it had received a merger notification from South Africa-based Vodacom Group Limited. The latter registered an intention to acquire 26.25 per cent shares owned by Mr Aziz’s Mirambo Limited in Vodacom Tanzania. In line with the provisions of the Fair Competition Act, No. 8 of 2003 and the Fair Competition Commission Procedure Rules, 2013, whose outcomes have yet to be published, the FCC conducted an investigation on the intended acquisition. The transaction will see the group’s stake in Vodacom Tanzania rise. In May 2014, the Group indirectly acquired a 17.2 per cent interest previously held by Mr Aziz. Vodacom Tanzania is also listed on the Dar es Salaam Stock Exchange (DSE).

Vodacom Group, a holding company, owns 48.75 per cent of the share capital of Vodacom Tanzania Plc, a company incorporated in the United Republic of Tanzania. According to financial statements, as at September 30, 2017, the group directly owned 48.75 per cent shares; Mirambo Limited owned 26.25 per cent, with the remaining 25 per cent held by the public through the Dar es Salaam Stock Exchange (DSE).

In March, last year, the Group launched an initial public offering (IPO) of 560,000,100 of its ordinary shares (25 per cent of total shares) at a price of Sh850 per share (Sh50 par value and Sh800 share premium) to comply with the regulations.

The IPO was conducted from March 9, 2017 to July 28, 2017 and the Group shares were listed in the Dar es Salaam Stock Exchange (‘DSE’) on August 15, 2017 under the ticker “VODA”. However, local investors failed to fully subscribe the floated shares.

Upon its closure, the company managed to attract 40,000 new investors to the Dar es Salaam Stock Exchange (DSE).

Last November, Vodacom Group announced it would spend up to $240 million to acquire a 17.2 per cent stake in Vodacom Tanzania from Cavalry Holdings, a Jersey island-registered private investment company wholly controlled by Mr Rostam Aziz. The company’s preliminary results show that it registered a net profit of Sh170.2 billion for the period ended March, this year, from Sh47.5 billion in 2017. This represents a 200 per cent change.

M-Pesa revenue grew by 16.7 per cent to Sh291.2 billion, equivalent to 30.1 per cent due to greater customer spending across the growing mobile ecosystem while mobile data revenue grew by 34 per cent to Sh141.6 billion on account of network densification, capacity upgrade and 4G expansions.