UMEME suspended from USE after handover to UEDCL
KAMPALA, April 1, 2025 — The Uganda Securities Exchange [USE] has suspended UMEME from the bourse following the expiry of its electricity distribution concession agreement and the subsequent hand over the role to the government-owned Uganda Electricity Distribution Company Limited [UEDCL].
Yesterday, the Government of Uganda paid US$ 118 million [Shs 432.677 billion] to UMEME following the expiry of the concession agreement signed in 2005.
“USE hereby informs all investors and the general public that the counter of UMEME Limited, which is listed on the Main Investment Market Segment of the USE, has been temporarily suspended,” a statement said.
The involuntary suspension of UMEME from the counter by the USE is made in the interest of investor protection and maintaining market transparency. The suspension is based on the ongoing public speculation regarding the end of the UMEME concession and the determination of the final buy-out amount.
The suspension of UMEME, also listed on the Nairobi Stock Exchange [NSE], took effect on March 31, 2025, for a period of two weeks to allow the company to address key concerns regarding price-sensitive information and to mitigate the potential impact of the end of the concession period.
“During the suspension period, the company will continue to comply with all continuous listing obligations applicable to it. In addition, the company will submit a progress report to the Exchange regarding the current state of affairs and any proposals,” the USE said of the company whose largest institutional shareholder is the National Social Security Fund, which has 23.2 percent.
Background
Established in 1948, the Uganda Electricity Board [UEB], the defunct government-owned electrical utility company, was responsible for the generation and distribution of power. At that time, there were 3,263 customers connected to the national grid.
Through various reforms, UEB was disbanded, leading to the establishment of the Uganda Electricity Generation Company Limited [UEGCL], the Uganda Electricity Transmission Company Limited [UETCL], and the Uganda Electricity Distribution Company Limited [UEDCL]. The three entities are now responsible for electricity generation, transmission, and distribution, respectively.
While the government retained transmission under UETCL, it handed the concessions for electricity generation and distribution to private companies. Despite inheriting technical losses as high as 38 percent, UMEME improved the reliability of power, unlike in the past.
https://thecooperator.news/govt-pledges-efficient-power-distribution-after-umeme-exits/
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