DAR ES SALAAM, Dec 14 (Reuters) - Tigo Tanzania, a subsidiary of Swedish telecoms and media group Millicom International Cellular, said on Wednesday it had applied to the east African country’s capital markets authorities for permission to sell shares in an an initial public offer (IPO).
The move has been made to comply with a legal requirement for the country’s eight telecommunications operators to have 25 percent local ownership by Dec. 31.
Tigo becomes the country’s second telecoms firm to file an IPO prospectus with the state-run Capital Markets and Securities Authority (CMSA) after Vodacom Tanzania, part of South Africa’s Vodacom Group.
Vodacom submitted its application for an IPO last month.
Tigo, Tanzania’s second-biggest mobile phone network, said it filed the prospectus on Tuesday.
“Today’s submission is a significant milestone ... and it is in keeping with our desire to provide our fellow Tanzanians an equal opportunity to enter into the capital of Tigo in the near future,” Ami Mpungwe, Tigo’s chairman said in a statement.
The third major operator, Airtel Tanzania, a unit of India’s Bharti Airtel, is yet to file for an IPO.
Telecommunications is one of the fastest-growing sectors in Tanzania’s economy and officials have said they hope share listings will bring more transparency and give the public a share of the industry’s profits.
Some analysts, though, say rushing through several IPOs at once could lead to unsold shares, given that only Tanzanians are allowed to buy them. (Reporting by Fumbuka Ng’wanakilala; editing by Elias Biryabarema, Greg Mahlich)