Information memorandum Tanzania: how an owner documents a sale

An owner who sells a Tanzanian business, or a stake in it, meets a pile of documents: teaser, NDA, information memorandum, data room. None is a government form. All are read by people with money at risk.

This guide sorts what the law requires from what the market expects. It follows one fictional packaging company through the numbers. It links to the posts that already cover the data room folders, the company profile and the business plan.

What the law or standard says, and what is only market practice

Start with a plain split. Tanzanian law regulates the transfer of shares, the registers, the tax on the sale, competition review and the ownership filings. It does not regulate the shape of a teaser, an NDA or an information memorandum. Those are practice.

Item	Law or practice	What a buyer tests
Teaser	Practice	Size, sector fit, reason for sale
NDA	Private contract	Scope, term, who may see the data
Information memorandum	Practice	Numbers that tie to the accounts
Data room	Practice	Evidence behind each claim
Share transfer and registers	Law (Companies Act)	Clean title to the shares
Stamp duty, capital gains tax	Law (TRA)	Tax paid and cleared
Merger review	Law (Fair Competition Act)	Whether clearance is needed first
Beneficial ownership	Law (GN 478 of 2023)	Who owns the company

The practice side rests on published sell-side guidance, not on Tanzanian rules. KPMG Luxembourg's May 2025 sell-side guide advises a structured digital data room, early gathering of audited accounts and contracts, and early disclosure of red flags. A German law firm's July 2026 note describes the same sequence: anonymised teaser, then NDA, then memorandum, then data room and bids.

Ansarada's May 2025 guide adds that an information memorandum is typically not legally binding and is not a prospectus. Whether a Tanzanian seller can face a claim over a misleading memorandum is a question for an advocate.

Who should read this

Three groups gain from this guide.

• Owners and directors of a Tanzanian company who expect to sell all or part of it within two years.
• Founders and minority shareholders preparing an exit or an investor round.
• Accountants and advisers asked for numbers that a buyer will test.

For the data room folder list, read the data room checklist for a Tanzanian SME. For the company profile, read what a company profile has to prove.

Where does the information memorandum sit between the teaser and the data room?

The order matters because each document discloses more than the last, and each is gated by the one before.

1. Teaser: one page, anonymous, sent to likely buyers.
2. NDA: signed by any buyer who wants the name and the detail.
3. Information memorandum: the full story, with a financial summary and a call for indicative offers.
4. Data room: the evidence, opened to bidders who pass the first round.
5. Bids and sale agreement: binding terms, then the filings and clearances.

The memorandum is the bridge. It must say nothing that the data room cannot prove. The way an investor reads a business plan applies here too: claims first, evidence second.

What should the teaser and the NDA say?

The teaser

A teaser sells the idea of a meeting. It carries a sector, a region, a revenue band, a margin band, the ownership on offer and the reason for the sale. It does not carry the company name, a customer name or an address. A buyer tests three things: is it the right size, is it in the right sector, and does the reason for the sale make sense.

The NDA

An NDA is a contract between the seller and each buyer. The parties decide its terms. A buyer's adviser will read for five points.

• What counts as confidential information, and what does not.
• The purpose limit: use only to evaluate this deal.
• The term, and what happens to documents on return or destruction.
• Who may see the material, including lenders and advisers.
• Non-solicitation of staff and customers, if the parties agree it.

Whether a non-solicitation clause can be enforced against a particular person is a matter for an advocate. Release the memorandum only after the right legal entity has signed.

What does the information memorandum contain, section by section?

There is no statutory template. Published practice guides agree on the broad content. Ansarada lists investment highlights, corporate information, products and customers, financial and operating performance, the market, and the proposed transaction with the stake and use of funds. Tanzanian buyers add a few items that local diligence will reach anyway.

Section	What the buyer tests	Evidence behind it
Highlights	Is each claim provable?	A page reference to the data room
Company and ownership	Who owns what, today	BRELA search, share register
Products and customers	Dependence on a few buyers	Sales ledger by customer
Management and staff	Key-person risk	Contracts, NSSF records
Financial summary	Do the figures tie out?	Management and audited accounts
Adjusted EBITDA	Are the add-backs real?	Invoices, payroll, lease
Market	Source and date of each claim	Published market data
Licences and approvals	Do they survive a change of owner?	Licence terms
The offer	Stake, price basis, timetable	Seller's board resolution

Two sections draw the most pushback. The first is adjusted EBITDA. IFRS does not define EBITDA, so the memorandum must. The IASB's IFRS 18, issued in April 2024, will require disclosure of management-defined performance measures in financial statements for periods starting on or after 1 January 2027. Whether the NBAA applies the same date to Tanzanian filers is to be confirmed. Our guide on which reporting framework applies sets out the tiers.

The second is the market section. Cite the source and date of each market figure.

For the monthly numbers behind the summary, see the management accounts board pack. For the forecast that often follows the memorandum, see the assumptions investors challenge.

Worked example: how the memorandum reconciles to the management accounts

This example is illustrative. The company, the figures and the 4.0 times multiple are invented to show the arithmetic. They are not a valuation of any real business and not a market claim.

PackCo is a fictional corrugated packaging converter in Dar es Salaam. Its owner offers 40% of the company. All figures are TZS million for the year to 31 December 2025.

Line	TZS million	Check
Revenue	4,800.0	Ledger
Cost of sales	3,360.0	70% of revenue
Gross profit	1,440.0	4,800.0 less 3,360.0
Staff	540.0	Payroll
Rent	120.0	Lease
Utilities and fuel	96.0	Bills
Selling and distribution	84.0	Ledger
Other administration	60.0	Ledger
Operating costs before depreciation	900.0	Sum of five lines
Reported EBITDA	540.0	1,440.0 less 900.0 (11.25%)

The memorandum then adjusts reported EBITDA. Each adjustment needs a document, and adjustments cut both ways.

Adjustment	TZS million	Evidence
Reported EBITDA	540.0	Management accounts
Owner pay above a market replacement (96.0 less 60.0)	+36.0	Payroll, offer letter
One-off legal fees, lease dispute	+18.0	Invoices, court papers
Rent at market (156.0 less 120.0 paid to the owner's company)	-36.0	Valuer's rent note
Adjusted EBITDA	558.0	540.0 + 36.0 + 18.0 - 36.0

The rent line is the one sellers forget. If the premises belong to the owner's other company and the rent is below market, a buyer will deduct the difference.

Next, the bridge from EBITDA down to profit must tie to the accounts. Depreciation is 150.0, so operating profit is 390.0. Interest is 60.0, so profit before tax is 330.0. Tax at an assumed 30% is 99.0, so profit after tax is 231.0. The audited figure would govern.

Now the illustrative valuation. At 4.0 times adjusted EBITDA, enterprise value is 4.0 x 558.0 = 2,232.0. Net debt is a bank loan of 420.0 less cash of 130.0, so 290.0. Equity value is 2,232.0 - 290.0 = 1,942.0. A 40% stake is 0.40 x 1,942.0 = 776.8 before any adjustment for minority status.

Multiple	Enterprise value	Equity value	40% stake
3.5 times	1,953.0	1,663.0	665.2
4.0 times	2,232.0	1,942.0	776.8
4.5 times	2,511.0	2,221.0	888.4

Show a range, not one point. At 4.0 times, equity value is about 8.4 times profit after tax (1,942.0 divided by 231.0), which a buyer will compute anyway.

Three tie-outs the buyer will run

• Revenue against the VAT returns. If returns show 4,812.0 and books show 4,800.0, the 12.0 gap needs a schedule.
• Staff cost against payroll and social security remittances.
• Net debt against the bank confirmation letter.

For how the valuation method itself is chosen and defended, read Zatra's post on business valuation in Tanzania.

What must be filed and paid when shares change hands?

On the Mainland the Companies Act, Cap. 212 (Revised Edition 2023, published by BRELA) governs the company. The Revised Edition titles the key provisions: section 79 (instrument of transfer), section 82 (notice of refusal), section 86 (notification of transfer to the Registrar), section 118 (register of members) and section 133 (annual return contents).

The older TanzLII text of 2016 shows the substance. A company may not register a transfer without a proper, duly stamped instrument. A refusal must be notified to the transferee within sixty days. We did not re-check those periods against the 2023 text, so confirm them.

Step	Authority	Point to confirm
Check articles and shareholders' agreement	The company	Pre-emption, consent rights
Stamp the instrument of transfer	TRA	1% of the value, within 30 days
Capital gains tax on the seller	TRA	Rate depends on the holder
Update the register of members	The company	Section 118
Notify the Registrar	BRELA	Section 86 time limit
Beneficial ownership forms	BRELA	30 days, per GN 478 of 2023
Next annual return	BRELA	Transfers since the last return

Stamp duty and capital gains tax

The TRA stamp duty page lists transfers of shares at 1% of the value of the shares approved by the Board. It says instruments executed on the Mainland must be stamped within thirty days. Zatra's fee register records the same rate under the Stamp Duty Act, Cap. 189, Schedule item 61(a), as at 26 September 2026 (register ID F0264). On the fictional 776.8 stake, 1% would be TZS 7.768 million if the approved value equals the price. Who bears it is a contract term.

Capital gains tax needs care. The fee register shows 10% of the gain for a resident and 30% for a non-resident on shares in a resident entity, citing Cap. 332 section 115 and the Finance Act 2025 (register ID F0236). TRA's own Taxes and Duties at a Glance 2025/26 still prints 20% for non-residents. The two sources conflict. Take the rate from TRA and your accountant before you price the deal. The TRA capital gains page exempts only listed shares below 25%.

Zatra's post on share transfer in Tanzania covers the steps in order, including the tax clearance certificate that it reports BRELA asks for. TRA's booklet says only that the certificate is issued on application. Treat the BRELA requirement as to be confirmed.

BRELA fees at 26 September 2026: TZS 22,000 per document filed (register ID F0005) and TZS 5,000 for a file search (register ID F0009). These are government fees, separate from any adviser's fee.

Does a sale have to be told to the Fair Competition Commission?

Sometimes. The Fair Competition Act, 2003 defines a merger in section 2 as an acquisition of shares, a business or assets that changes control of a business in Tanzania. Section 11 prohibits mergers that create or strengthen a dominant position. It makes a merger notifiable if turnover or assets exceed thresholds set by gazetted order.

The original threshold was TZS 800 million, set in GN 17 of 2007. A 2017 amendment order raised it. Zatra's fee register records TZS 3,500,000,000 under GN 222 of 2017 (register ID F0173). Independent notes from Rive & Co (February 2026), RSM Tanzania and Baker McKenzie give the same figure. One July 2017 note prints 3.6 billion in its text and 3.5 billion in its headline.

We could not open the FCC's own site or the Gazette text, because the FCC's pages need a browser to load. So treat TZS 3.5 billion as the reported figure, not a confirmed one, and check it with the FCC before relying on it.

Timing and the standstill

The 2003 text gives the Commission 14 days to decide whether to examine a notified merger. If it does, the merger is held for 90 days, and the Commission may add up to 30. A Clyde & Co review of the Tanga Fresh case reports that implementing before clearance was a breach, so early steps in a deal can count.

The notification fee runs from TZS 25 million to 100 million by combined turnover or assets (register ID F0172). PackCo's own turnover of TZS 4,800 million already exceeds the reported threshold, so the question cannot be skipped.

What is unknown

Whether a 40% minority stake changes control is unsettled in the sources we read. Baker McKenzie says a non-controlling minority acquisition is notifiable if the threshold is met. Legal 500's 2026 guide says the deal must change control. Ask an advocate before signing. We did not verify the penalty bands for failing to notify at a primary source. Secondary guides report fines tied to turnover. Zatra's post on FCC merger notification goes deeper.

What happens to land, licences and incentives in a sale?

A share sale does not move the company's land. The company stays the holder. An asset sale does move it, and the Land Act, Cap. 113 text we read makes some assignments of a right of occupancy subject to the Commissioner's approval. A disposition without required approval is inoperative. Section numbers in the current revised edition should be confirmed.

The same text treats a company with majority non-citizen owners as a non-citizen company for land purposes. A sale that tips the majority across that line can change what the company may hold. Ask an advocate.

Licences differ by regulator. Some are personal to the holder and some need consent. List each licence in the memorandum with its issuer, expiry and transfer rule. Leave a cell blank where you do not know, because a blank is better than a guess.

Investor incentives

If the company holds a TISEZA certificate of incentives, ask whether a change of ownership needs an amendment. The fee register records an amendment fee of TZS 3,000,000 under the Investment and Special Economic Zones Regulations 2025, GN 466 of 2025 (register ID TZ-05). Whether a change of shareholder triggers an amendment was not stated on the pages we could read at TISEZA, so ask the Centre. Our guide to TISEZA incentives and the investor pack covers the certificate itself.

How does a Zanzibar company differ from a Mainland one?

The Mainland Companies Act defines "Tanzania" in section 2 as Mainland Tanzania, without Zanzibar. A Zanzibar company is not on the BRELA register. Zanzibar has its own company registry, the Business and Property Registration Agency (BPRA), and its own Companies Act. Eden Law Chambers (23 March 2026) names it as Companies Act No. 15 of 2013. We could not open BPRA's copy, so confirm the number there.

Point	Mainland	Zanzibar
Company registry	BRELA	BPRA
Companies law	Cap. 212, R.E. 2023	Act No. 15 of 2013, to confirm
Investment body	TISEZA	ZIPA, which facilitates
Competition body	FCC, Cap. 285	Its own commission, rules unverified
Land	Land Act, Cap. 113	Different land law, confirm there

Zatra's post says that ZIPA may facilitate an investment but does not incorporate the company. A Zanzibar Fair Competition Commission exists, but whether Zanzibar requires its own merger notification is unverified. For a Zanzibar target, confirm every filing, stamp and clearance with the Zanzibar authority, and read Mainland and Zanzibar company setup and land rights for foreign investors.

How do beneficial ownership filings change the sale?

The Companies (Beneficial Ownership) Regulations, 2023 (GN 478 of 2023) set 30 days for most filings after the relevant entry or change. They also make a failure to keep records or report changes an offence with a fine of TZS 5 million to 10 million (regulation 10). A power in regulation 8 lets the Registrar refuse to register a company's documents if the information is missing or out of date.

The forms were renumbered. GN 82 of 2026, published on 20 March 2026, lists Forms 15b to 15f for beneficial owner particulars, cessation, declarations and changes, and Form 131 for the annual return. The regulations still print the older numbers 14b to 14f.

For a buyer this is a title test. If the register of members, the BRELA record and the beneficial ownership filings disagree, the seller's claim to own the shares is in doubt. Fix gaps before the teaser goes out. Our guide to beneficial ownership disclosure covers the filing, and Zatra's post explains beneficial versus legal ownership.

How should the data room be built to support the memorandum?

Do not rebuild the folder list here. The seven-folder checklist already covers it. Three practice points belong to a sale specifically.

• Staged access: by bidder group and process stage, with a log of what each bidder saw.
• A reference for every claim: each statement in the memorandum points to a data room index number.
• Personal data: staff and customer records need redaction or care. Clyde & Co's note on the Personal Data Protection Act, 2022 (No. 11 of 2022) is the independent source we found. Confirm the current obligations with the Commission or an advocate.

KPMG describes a vendor due diligence report as a seller-commissioned financial review that can speed the buyer's work.

What to do now

1. Fix the numbers first: reconcile revenue to the VAT returns, staff cost to payroll and net debt to bank letters, and document each EBITDA adjustment.
2. Choose the structure: a share sale, an asset sale or a new share issue. Each triggers different filings and taxes. Ask an accountant and an advocate before you price.
3. Clean the registers: make the share register, BRELA record and beneficial ownership filings agree.
4. Draft the teaser and the NDA: bands not exact figures, and a signed NDA before the memorandum goes out.
5. Write the memorandum: every claim gets a data room reference, and every market figure gets a source and a date.
6. Screen the approvals: FCC, land consent, licences, TISEZA and, for a Zanzibar target, the Zanzibar authorities. Make clearance a condition of completion.
7. Open the data room in stages: by bidder group, with a disclosure log.
8. Instruct the professionals: an advocate for the sale agreement and any dispute, an accountant for tax and reporting.

Key dates

No statutory deadline governs a teaser, an NDA or a memorandum. The dates below are the legal and source dates that shape a sale.

Date or period	Event
2 June 2017	FCC threshold amendment order published as GN 222, per a July 2017 law-firm note
20 March 2026	GN 82 of 2026 publishes the renumbered company forms
26 September 2026	Date of the government fees quoted here
1 January 2027	IFRS 18 effective date for periods starting on or after it
30 days after signing	Stamp the share transfer instrument, per TRA
30 days after the entry or change	Most beneficial ownership filings, per GN 478 of 2023

What the NEMBO desk prepares

The Client shares the facts: the accounts, the registers, the contracts and the ask. Zatra Consultants prepares and checks the content. NEMBO designs and delivers the finished documents.

• A one-page teaser, from the investor documents desk.
• The memorandum, laid out like a company profile with a financial summary and a reconciliation table.
• Management accounts and reporting packs from the CFO documents desk.
• An indexed evidence list, built the way the tender evidence file is indexed.
• A forecast, where a buyer asks for one, from the plans desk.

Two cost buckets apply. Government fees at the official rate are paid to the authority and are separate from NEMBO's and Zatra's fees. Fees for the studio's work are published on packages and pricing and quoted in writing. Professional documents are read online, free and whole, with a customise option for your brand. See how a job runs, the service levels and finished work, or share the details.

How Zatra helps

Zatra checks the facts, the filings and the figures. It reads the BRELA record against the share register, reconciles the memorandum to the accounts, lists the approvals a deal may need, and marks each point settled, to verify or unknown. Its desks cover mergers and acquisitions advisory, investment due diligence, business valuation and share transfer and restructuring.

The desk does not decide or guarantee any authority's outcome, whether that authority is a bank, a tender panel or a regulator. It does not act as your advocate or your accountant. Route disputes, prosecution and legal opinions to an advocate. Route tax and reporting to an accountant. For a Zanzibar company, the Zanzibar authority decides the point.