Sharp Daily
No Result
View All Result
Sunday, June 1, 2025
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
Sharp Daily
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
No Result
View All Result
Sharp Daily
No Result
View All Result
Home Business

Uganda’s last-minute USD 190.0 mn loan for Umeme buyout sparks parliamentary scrutiny

Kevin Cheruiyot by Kevin Cheruiyot
February 27, 2025
in Business
Reading Time: 2 mins read

Members of the Committee of National Economy have expressed concerns over the Ugandan government’s last-minute request for a USD 190.0 mn loan to facilitate the buyout of Umeme.

The loan, expected to be secured from Stanbic Bank, was introduced just a week before the concession agreement with Umeme expires on March 30, 2025. The funds are intended to compensate Umeme for unrecovered capital investments, as stipulated in the lease and assignment agreement. Uganda aims to finalize the buyout before Umeme’s assets are transferred to the state-owned Uganda Electricity Distribution Company (UEDCL).

In 2022, the government announced it would not renew Umeme’s concession due to high electricity costs. Under the 2005 concession agreement, Uganda is obligated to reimburse the power utility company for any outstanding capital investments at the contract’s end. As of February 24, 2025, the estimated buyout amount stood at USD 201.0 mn.

Several MPs have questioned the urgency of settling Umeme’s debt, especially when other companies have substantial outstanding debts with the government.

RELATEDPOSTS

No Content Available

The finance minister explained that any delay beyond the deadline could result in penalties, including potential interest charges payable to Umeme. The concession agreement also imposes a strict timeframe for the government to audit the company’s investments.
The Director of Economic Regulation at the Electricity Regulatory Authority stated that Umeme had invested approximately USD 832.0 mn in substations, with an expected recovery period of at least 20 years. To date, the company has recouped around USD 680.0 mn of this investment.

In January, the government granted UEDCL two licenses for distribution and sales, formally marking the end of Umeme’s concession.

Umeme was initially owned by a consortium led by the UK’s CDC Group plc before being acquired by private equity firm Actis in 2009. In 2014, Actis sold two-thirds of its stake to South Africa’s Investec Asset Management. By the end of 2023, Uganda’s National Social Security Fund (NSSF) was the largest shareholder (23.4%), followed by South African investment firm Allan Gray (14.8%).

Listed on both the Nairobi Securities Exchange and the Uganda Stock Exchange in 2012, Umeme became the most actively traded stock on Uganda’s bourse.

In 2024, Umeme was ranked the second-best dividend stock on the Nairobi Securities Exchange and had led both capital gains and dividend performance in 2023.

Previous Post

Understanding commercial paper as a viable short-term investment option

Next Post

Kenya successfully prices $1.5 Billion eurobond to strengthen debt management

Kevin Cheruiyot

Kevin Cheruiyot

Related Posts

Business

Kenya’s coffee sector revitalization

May 19, 2025
Business

How digital tools are transforming youth agribusiness in Kenya

May 19, 2025
Business

Privatization of sugar millers sparks debate

May 15, 2025
Business

Safaricom forecasts earnings boost as Ethiopian losses shrink

May 14, 2025
Business

Kenya’s new digital tax: Impact on businesses and consumers

May 6, 2025
Business

Safaricom to deactivate unverified M-Pesa pay bills

May 2, 2025

LATEST STORIES

Best investments for Kenyan seniors: Secure, predictable & low-risk

May 30, 2025

Why June is the Secret Sweet Spot for Travel

May 30, 2025

Strategies to elevate more women to corporate leadership

May 30, 2025

Tap on Kenya’s 2025 tech revolution

May 30, 2025

How CURBS supports employers and employees

May 30, 2025

NSE deserves more attention from young investors

May 29, 2025

The silent strain of remote work on Kenya’s urban workforce

May 29, 2025

How Kenya’s crypto bill could reshape the digital economy

May 29, 2025
  • About Us
  • Meet The Team
  • Careers
  • Privacy Policy
  • Terms and Conditions
Email us: editor@thesharpdaily.com

Sharp Daily © 2024

No Result
View All Result
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team

Sharp Daily © 2024