State, Indian cellphone firm resolve shareholding wrangle in Airtel

12Jan 2019
The Guardian Reporter
Dar es Salaam
The Guardian
State, Indian cellphone firm resolve shareholding wrangle in Airtel

THE government of Tanzania disclosed yesterday that government shares in Airtel Tanzania will now be 49 per cent, up from 40 per cent, with Bharti Airtel commanding a 51 per cent stake from the previous 60 per cent.

President Dr. John Pombe Magufuli greets Bharti Airtel Chairman Sunil Mittal shortly before their talks at State House in Dar es Salaam yesterday. Photo: State House

President John Magufuli disclosed this at the State House in Dar es Salaam when he met with Bharti Airtel Chairman Sunil Mittal, where he also said the firm would be holding discussions with the Tanzania government to deliberate on the matter.

 

He said Airtel Tanzania has not been paying dividend to the government, adding that they expected to hold discussions yesterday which were in the final stages.

 

“It is good news that the telecoms firm has agreed to give dividend to the government, which for eight to 10 years we have not been receiving. The percentage of dividend is still under discussion,” President Magufuli said.

 

 According to the president, discussions regarding share ownership in Airtel Tanzania have been ongoing for a long time now.

 

“We have in principle agreed to move forward with a new arrangement of shareholding of 51:49 where Bharti Airtel shareholding will now drop from 60 per cent to 51 per cent and the people of Tanzania, through the government, will own 49 per cent,” Mittal said.

 

In 2017 the president disclosed that the state-run Tanzania Telecommunications Company Ltd (TTCL) owned the local subsidiary of Bharti Airtel outright but had been cheated out of its shares.

 

However, the telecoms firm disputed the claim, saying it received all the required approvals from state organs when it bought a 60 per cent stake in Airtel Tanzania and had complied with all government rules.

 

The Barti Airtel chairman said yesterday that Tanzania wanted to increase its shareholding and that such negotiations do take some time.

 

“We are glad that we have come to a point where we will be making some final decisions,” Mittal said.

 

Other major mobile phone operators in Tanzania include Vodacom Tanzania, part of South Africa’s Vodacom; Tigo Tanzania, which is part of Sweden’s Millicom, and Halotel, owned by a Vietnam-based telecoms operator Viettel.

 

In 2016 the government ordered telecoms companies to list at least a quarter of their units on Tanzania’s stock exchange with a view to increasing domestic ownership in the firms.