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Public ownership in TanzaniteOne hangs in balance
2006-01-04 14:31:06
By Adam Ihucha, Arusha
Plans by TanzaniteOne Company Limited to list its shares on the Dar-es-Salaam Stock Exchange (DSE), may take shape from March next year.
TanzaniteOne had made enquiries with the Capital Markets and Securities Authority (CMSA) two years ago about the possibility of getting listed on DSE.
All conditions for listing were availed to the tanzanite mining company, based in Simanjiro district, Manyara region in northern Tanzania.
Currently, TanzaniteOne, which is the only Tanzania’s mining firm ’admitted’ on the London Stock Exchange (LSE), is working hard in liaison with DSE to have its shares listed locally.
However, DSE’s boss Jonathan Njau said on Monday his organisation has not officially received an application from TanzaniteOne seeking to be considered for listing on DSE, beginning with Public Initial Offer (IPO).
Njau is confident that TanzaniteOne is a good company befitting an opportunity to raise capital from the public domain, but certain technicalities are presently holding the company back.
For instance, he said, TanzaniteOne is admitted on LSE in the alternative investment market board which, is the riskiest market segment.
Unfortunately, he said, such a trading arrangement has not so far been established on the nascent DSE.
However, beginning March this year, some fundamental reforms regarding the conditions for companies wishing to get listed on DSE are envisaged.
The outcome might, among others, allow an alternative investment market to expand more opportunities for raising capital and trading stocks.
Depending on events, the public would be sensitized about the delicacy and extent of risks involved when investing in such line of stock market.
TanzaniteOne President and chief operating officer Ian Harebottle says his company was eagerly waiting for the time when the DSE would give them the green light to register their shares there.
’It’s my firm belief that listing of our company will give an opportunity for tanzanians to buy their company’s shares,’ Harebottle explained.
Shares in Tanzanite, the rare gem only found in Tanzania at the LSE have gone up by 170 percent since its admission two years ago.
Available reports indicate that TanzaniteOne is now one of the three companies making lucrative profits at LSE.
TanzaniteOne, operating at Mererani in Simanjiro, Manyara region, raised sterling pounds 5m at an initial price of 42 pence per share when admitted in August 2004 to trading on the alternative investment market (AIM) of LSE.
According to Harebottle, the company’s share price provided by Hemscott Group Limited has now gone up by half to sterling pounds 1.48 from 42 pence per share from late 2004.
Last May, TanzaniteOne announced net earnings of USD 4.4m, or USD8.6 cents per share, and declared a maiden dividend of USD1 cent.
Tanzanite was discovered in 1967 at Mererani hills - a site that remains the world’s only known source of tanzanite. This precious gemstone is said to be 1,000 times rarer than diamonds.
It is estimated that the global wholesale market for polished tanzanite is between USD200 - 300 million per annum.
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