Why Gov’t Has Finally Sold Uganda Telecom To UTCL

Uganda Telecommunications Corporation Limited (UTCL), a Government owned new company, was incorporated on 8th April 2021 and on 23rd February 2022, entered into an Asset Sale and Purchase Agreement to buy the Uganda Telecom Limited (UTL) assets and not debts and or liabilities of Uganda Telecom.

UTCL is a fully-Government of Uganda owned with 60 percent owned by the Ministry of Finance, Planning and Economic Development and 40 percent by the Ministry of ICT and National Guidance.

The sale deal concludes a period of upheaval for the UTL operator. When the Lap Green Network of Libya, a subsidiary of the state-owned Libyan Post, Telecommunications and IT Company (LPTIC), pulled out of the 14-month-long rescue plan of UTL in March 2017, its partner, the Uganda government, had to buy UTL’s 69 percent stake in UTL from Lap Green and nationalize the telco.

In May this year, the Ugandan cabinet approved a revamp of struggling UTL with a four-pronged strategy, the priority being to “source for a competent investor.” The other strategic actions extended license increased spectrum bandwidth, and unlimited access to backbone networks, would not only strengthen the operator but help make it more attractive to potential buyers.

The handover of UTL assets to UTCL was presided over by Ms. Evelyn Anite, the state minister for privatization and investment.

The ceremony was also attended by UTL’s outgoing administrator Ruth Sebatindira and officials from UTCL, including Dr. Grace Ssekakubo, the chairman board of directors.

“This redevelopment of the company will help in the provision of the youth out there with jobs, to help address the challenge of youth unemployment”, she said while handing over the UTL assets in Kampala over the weekend.

She added that UTL has a huge client base of ministries, agencies, and departments in addition to a 9.13 percent shareholding in West Indian Ocean Cable Corporation (WIOCC). She urged UTCL to make use of this clientele to succeed with its new assets.

UTL administrator, Ruth Sebatindira, said that her main task when being appointed by President Yoweri Museveni, was to ensure a smooth transition of the organization to new owners.

She revealed that effective November 30, UTL will cease to employ anyone and former employees are free to seek new terms with UTCL or employment elsewhere. The new terms come into effect on December 1.

The company currently employs 230 people with 317 sites and masts country-wide out of 472.

The payment of the Uganda Communications Employees Contributory Pension Scheme (UCECPS) liability of Ush 165BN ($43,945,027), as verified by the Auditor General, is ongoing to all qualifying former Uganda Posts and Communication Corporation (UPTC) staff.

Dr. Grace Ssekakubo, the Chairman Board of Directors, UTCL, said as a Board, they are positive that theirs will be a service that not only makes Ugandans happy but that elevates them, a service that not only satisfies them but one that leaves them ecstatic.

He further pointed out that the UTCL Board was appointed three months ago, and it has worked relentlessly to put the company in a position to be able to receive the Assets and Business of UTL and ensure business continuity.

“I am privileged to lead this team of patriotic and dedicated Ugandans with a special assignment to deliver to Ugandans,” he said.

The recent World Bank report, reveals that for every 10 percentage-point increase in high-speed Internet connections, there is an increase in economic growth of 1.3 percentage points.

Dr. Ssekakubo has pledged to offer world-class internet service at the new UTCL.

The company, he says will in the coming months work on various initiatives including; investing in the latest technology of 5G and attracting the best talent in the market, plus upskilling the internal staff they have inherited.