Assessment of motivating factors for firms to cross-list on Dar es Salaam stock exchange in Tanzania

This study assessed the motivating factors for firms to cross-list on Dar es Salaam Stock Exchange in Tanzania. The three research objectives that guided the study are: first, to examine how cultural similarities motivate firms to cross list; second, to find out the role of regional integration on firm’s decision to cross-list; third, to explore how firm’s desire to lower cost of capital can motivate cross-listing; and lastly, to examine the motivating factors in terms of their relative importance to the crosslisting firm. Data were collected from managers of seven cross-listed firms in Tanzania. The study applied qualitative approaches and a case study research design. The sample size was 7 respondents one manager from each cross-listed firm. Data were collected through interview and documentary review. Closed-ended data inform of multiple choices were given values, labels and analyzed using Statistical Package for Social Science (SPSS) version 20 and for qualitative data recursive abstraction technique was used. This study observed that culture is one of the most important motivation since crosslisting involves crossing borders which requires being aware of cultural differences because what may be considered perfectly acceptable and natural in one country, can be confusing or even offensive in another. The study also found out that legal and regulatory framework is one of the important motivations under regional. Furthermore, it has been discovered that through cross-listing a firm can reduce its perceived cost. The main recommendation of this study is that DSE officials should identify more factors that motivated those few seven cross-listed firms to cross-list in Tanzania such as what has been discovered by this study and work on them so that to motivate more firms from different areas to cross-list in Tanzania.