The Nairobi Securities Exchange (NSE) and the Uganda Securities Exchange (USE) have temporarily suspended trading of Umeme Limited shares following the buyout of the company’s operations by the Ugandan government.
- •The suspension, effective March 31, 2025, will remain in place until April 11, 2025, or until further notice from the authorities.
- •The state-owned Uganda Electricity Distribution Company Ltd. (UECDL) has assumed control of the country’s power distribution network.
- •Umeme received about half of what it valued as the buyout balance, and has said it will be invoking the dispute clauses in the concession agreement.
“Umeme disputes, among several things, the audited figure in the OAG’s Report and has informed the Government of Uganda, that the company will issue a formal notice of Dispute,” the company’s Board said in a notice.
Under the terms of the agreement, Umeme was entitled to compensation for unrecovered investments, though the final amount has been a point of contention. Umeme initially sought US$231 million, while the Energy Ministry countered with US$191 million. Uganda’s Auditor-General estimated the figure at US$201 million in a preliminary assessment.
In March, Uganda’s parliament approved a request by the government to take out a US$190 million loan from Stanbic Uganda to fund the buyout. The state then paid US$118 million, with US$9 million to be paid once ongoing projects are complete.
The concession gave the government a narrow window to audit Umeme’s assets and settle payments, including a premium. The dispute over different valuations may end up in a prolonged legal process, which would ultimately hurt investor confidence especially in capital-intensive public good projects.
