In a deal valued at around 356.8 million Ugandan shillings, Uganda Telecommunications Corporation Limited (UTCL) has completed the takeover of Uganda Telecom Limited (UTL), which has been experiencing difficulties over the past few years.
In acquiring UTL, UTCL inherits UTL's staff and liabilities, as well as the company's assets, including parcels, buildings and network infrastructure. The incumbent's debt is estimated at 1 trillion shillings, while its assets are valued at 250 billion shillings.
The Ugandan government announced its intentions to nationalize UTL in 2017, when it controlled only 31 % of the company's shares. The company was the subject of a dispute between Kampala and the incumbent's majority shareholder, Libya's LAP Green, which controlled 69 %. The two parties accused each other of mismanagement that caused UTL's bankruptcy, so LAP Green decided to suspend all financial support to the incumbent before being finally dismissed by the government.
Following LAP Green's exit from UTL's capital, the government began exploring ways to revive the incumbent with the introduction of a new investor. Teleology Holdings had been selected in 2018 to take over UTL's majority ownership, but the process was subsequently canceled. Against this backdrop, Uganda Telecommunications Corporation Limited was formed in April 2021. In February 2022, the company signed an asset sale and purchase agreement worth 256.9 million Ugandan shillings with the UTL administration.
The new telecommunications company is expected to launch operations in Uganda soon. According to Grace Ssekakubo, UTCL's board chair, the company will invest in 5G+ network technology, employee capacity building and developing a digital ecosystem; it also plans to provide mobile money services with its Ug-Sente platform.