Dar es Salaam. Tanzania Electric Supply Company (Tanesco) Managing Director, Maharage Chande, said yesterday that it was possible for the parastatal to be listed on the Dar es Salaam Stock Exchange (DSE).
He, however, said there were a few prerequisites that must be cleared in order for that to happen.
Mr Chande, who was tapped from the private sector to head Tanesco, said the firm will first have to clear its books before it is listed on the Dar bourse.
Secondly, the organisation will have to attract strategic investors in order to build enough liquidity.
He said offering corporate bonds and UTT should be the first step in the next three to four years, and thereafter Tanesco might be ready to be listed on the capital markets.
In October 2022, the government came to the rescue of Tanesco and Tanzania Petroleum Development Corporation (TPDC) by converting their debts of about Sh5 trillion into equity. The move, according to Energy Minister January Makamba, is meant to clean the balance sheet and build the parastatals’ capacity.
“Given the proliferation of financial instruments and its massive financial needs, the move will give Tanesco flexibility to find resources to fund its projects. The flexibility will not only be related to financial resources but also in terms of the cost of funding,” said Mr Makamba.
About working with the private sector, Mr Chande said Tanesco is currently engaging private sector players to see possible ways of partnering in the supply of energy in the country. Speaking during a Twitter Space session organised by Kumekucha yesterday, he said the deal breaker has always been tariffs. “We are engaging the private sector. Those who are serious can come on board. However, some investors want to come on board with very high expectations for return on investment, beyond the model used by the parastatal.
“We don’t want investors’ return on investment appetite to exceed 14 percent. Beyond that, it won’t be bearable and a good deal for the government,” said Mr Chande, adding that Tanesco works on an open book principle.
The law allows the private sector to take part in energy generation but that transmission and distribution are solely the mandate of Tanesco.