The withdraw by the mobile telecommunication company TNM of their cautionary statement which indicated that talks were abandoned after “unacceptable indicative offer terms” from South Africa-based mobile operator Vodacom has led to several reactions from stockbrokers.
The Malawi operator wanted to sell its substantial stake to the South Africa phone giant Vodacom but sources said the two failed to agree on the price.
TNM is listed on the Malawi Stock Exchange and stockbroker African Alliance says the move will most likely have a negative impact on the price of TNM as investors panic to sell off their positions in the stock.
“This will result in downward pressure on the price. When TNM initially released the cautionary statement, many investors had rushed to buy the stock with demand pressure seeing the stock move from K1.40 to K1.90,” said African Alliance.
FDH Stockbrokers Malawi Limited said there is going to be a drop of TNM shares anytime soon since the price increase was based on the fact that a strategic investor was coming in.
In an interview, FDH Stockbrokers Managing Director Davis Manyenje said some investors are giving the instructions to sell off some TNM stock.
“The impact may be unprecedented because the volume is expected to be significant as the week progresses because of a negative perception this news has created,” said Manyenje.
He added that although TNM investors are willing to sell the shares at the Malawi Stock Exchange no-one has showed interest to buy.
TNM price on MSE has SINCE remained intact at K1.90 per share.