Prime
Give Uganda Telecom Limited kiss of life
What you need to know:
- The issue: UTL.
- Our view: The new administrator should give UTL a kiss of life. But to do this, she must read and act on the ISO report on UTL assets, Justice Mugambe’s judgement and the Auditor General’s report on UTL.
On Thursday, High Court judge Lydia Mugambe appointed former Uganda Law Society chief Ruth Sebatindira as the new administrator of Uganda Telecom Limited (UTL).
On December 17, 2019, enraged creditors under the Uganda Contribution Employees Contributory Pension Scheme petitioned High Court to replace Mr Twebaze Bemanya with a seasoned insolvency practitioner.
Since April 2017, UTL has been under receivership as disagreements between Mr Bemanya and Ministry of Finance officials mired the struggle to reverse the company’s precarious financial status. UTL debts totalling Shs900b had exceeded its assets base of Shs148b.
On January 9, 2018, the president intervened and stopped government agencies from recovering more than Shs200b from UTL. He also issued a directive for government agencies that had previously been buying internet bandwidth from NITA-U, to get it from UTL.
The President explained that this would save the company from what he called a group of corrupt officials who ‘sucked’ UTL dry through self-enrichment with huge salaries and were scheming to devalue its assets.
After Investment Minister Evelyn Anite defended the need to protect UTL from people she called ‘vultures’, Mr Museveni, directed that UTL network be revamped and used to restore government data.
He also instructed UTL to conclude talks with a Chinese state-owned IT company- China National Electronics Import & Export Corp, which was selected to establish a smartphone factory in Uganda.
The President had commendably levelled the ground for a new investor to take over UTL. But the fight over Mauritius Telecom and a Nigerian company, Teleology Holdings Limited, messed up things. Mr Bemanya and Anite failed to agree on the right company to take over UTL. One issue led to another, leading to Bemanya’s exit.
Picking from UTL public flare-ups, it’s obvious, too much toothpaste has left the tube and the process has irrefutably dragged on for more than two years without any serious explanation other than qualms, incompetence and arrogance. It’s therefore, our prayer that the outbursts stop.
The purpose of taking UTL into administration was to enable the company reorganise its affairs and get a serious investor to help the company return to business. Senior counsel Sebatindira, should, therefore, use her skills in insolvency matters to fix the mess at UTL.
To protect the integrity of the new procurement process, our considered view is that Teleology Holdings Limited and Mauritius Telecom should not be allowed to bid. The procurement process must be expedited before it’s too late.
The new administrator should give UTL a kiss of life. But to do this, she must read and act on the Internal Security Organisation report on UTL assets, Justice Mugambe’s latest judgement and the new Auditor General’s report on UTL.
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