Swala Oil Tanzania IPO excites market
DAR ES SALAAM, Tanzania – Swala Oil and Gas Plc has listed 99 million shares on the Dar es Salaam Stock Exchange (DSE)’s Enterprise Growth Market (EGM), an equity market window specifically intended for Small and Medium Enterprises (SMEs) and start-ups.
This comes after Swala’s Initial Public Offer (IPO) was oversubscribed by 39%.
This has enabled the oil and gas company to raise Tsh6.64 billion (about $4 million) from the Tanzanian public.
Swala’s IPO has oversubscribed by nearly 4 million shares and raised nearly Tsh2 billion ($1.21 million) more than the maximum subscription of Tsh4.8 billion ($2.89 million), it intended.
The Chairman of Swala, Ernest Massawe told East African Business Week in Dar es Salaam last week the Swala listing on the EGM marks a new chapter as the oil and gas company.
“Not only that, the listing also marks another step forward in realizing our ambition to achieve a successful venture based on private and public partnership,” Masawe said.
The progress makes Swala to be the only oil and gas company to list on the stock market in the East African region.
Former President of Tanzania Ali Hassan Mwinyi officiated at the listing event.
He said the high demand for Swala shares during the IPO is a clear testimony that there is a great appetite amongst Tanzanians in investing in their country’s economy.
“It is a great honour that we commemorate one of these companies that has stepped out of the status quo to open its doors to involve the Tanzanian public in owning a stake in this industry; allowing them to capitalize in the country’s resources in a manner that will build and diversify their investment portfolio,” Mwinyi said.
Mwinyi said that it also shows a growing confidence in the national stock exchange and trade in securities as a whole.
“I am confident that Swala, as a public company, will be able to capitalize on its achievements to date and continue to deliver for all its stakeholders,” he said.
The company said last week the money it has raised would enable them to commence the 2014 seismic program and we look forward to fruitful results.
The Chief Executive Officer of Swala Dr David Ridge told East African Business Week that the funds raised would enable Swala to start a seismic survey over its Pangani license.
“We shall then move our teams to perform a similar seismic survey in Kilosa-Kilombero,” he said.
According to him Swala is also taking the opportunity to give work experience to students that it sponsoring at the University of Dar es Salaam.
He said in the next weeks, they aim to establish the Swala trust, an innovative approach to engaging with the communities in which they operate.
“We have an active business development program and we intend to grow the business and to deliver value for our current and future shareholders,” Ridge said.
The Chief Executive Officer of DSE, Moremi Marwa said that Swala becomes the second company to list on EGM within a year of its launching.
The first company to list via EGM is Maendeleo Commercial Bank. It listed last year. “Since then, we have witnessed an increasing interest from entrepreneurs, business owners and potential investors on DSE and the EGM,” Marwa said.
Marwa added that the listing on DSE comes with transparency, good corporate practices and proper disclosure.
By Leonard Magomba, Sunday, August 17th, 2014
http://www.busiweek.com/index1.php?Ctp=2&pI=1686&pLv=3&srI=53&spI=20&cI=11
