Mauritius Telecom has been recommended to takeover Uganda Telecom Limited (UTL) after it offered to invest $100 million for three years with considered assets of $45 million, an investigation conducted by TrumpetNews reveals.
This telecom firm is the 6th last best evaluated bidder.
However, the Financial Intelligence Authority (FIA) in its due diligence report submitted to President Yoweri Kaguta Museveni clears Mauritius Telecom as the “only credible and financially stable company among the evaluated companies.”
This recommendation draws queries since the best evaluated company from USA, Hamilton Telecom has offered capital investment of $285 million for a period of 3 years and its considered assets stand at $70 million.
The proposed shareholding structure is 62% for Hamilton Telecom and 38% for Government whereas Mauritius Telecom wants 69% of shares and government takes 31%.
The other four evaluated companies include; Afrinet Communications Limited which proposed to inject $ 150-$300 million with assets of $67 million and acquiring 68% of shares, Teleology Holdings with a consideration for assets of $60.5 million and investing capital worth $230 million and acquiring 67% of shares, Neubacher Montage LLP offered assets of $60 million and proposed capital investment of $211 million taking 68% of shareholding and lastly Baylis Consortium with $55 million assets and 120 million capital investment acquiring 70% of shares for five years.
It must be noted that the total debts of UTL stand at $147 million with five creditors who include; Government $53.61m, NSSF $2.84m, ESATD/PTA Bank $8.91m, UCECPS $3.34m and others $77.86m.
It is against this backdrop that the government of Uganda ordered the line ministry, Ministry of Finance to seek for a potential investor to recapitalise UTL after the Libyans pulled out last year.
UTL had been declared bankrupt.
The responsibility of hunting for a partner was handed over to State Minister of Investment Hon Evelyn Anite who through a court process placed UTL under an administrator because the company was financially distressed and technically insolvent.
The administrator Mr Bemanya Twebaze was tasked to make the company healthier and attract investment before sourcing for a strategic partner.
Conditions
Whereas the process was in advanced stages of selecting an investor to recapitalise UTL, several investors set conditions to partner and revamp the defunct parastatal.
Among the conditions include; extension of service license for 20 years, expansion of frequency bandwidth- spectrum, tax waivers on import duty for equipment for 4 to 7 years, the resultant company to become the sole provider of ICT services to government and access and uses national backbone infrastructure.
TrumpetNews also understands that 17 companies showed interest in taking over the liabilities of UTL but only 6 were considered as the best evaluated to investment their capital and revamp the company.
The administrator, Mr Bemanya, then requested the Financial Intelligence Authority headed by Sydney Asubo to institute an investigation on the six telecom firm to ascertain whether their financial muscle and capability to run UTL.
Financial Intelligence Authority, after its investigations authored a report recommending that Mauritius Telecom considered as the last best evaluated basing on its capital of $100 million and assets of $45 million takes over UTL.
Mr Sydney Asubo, contacted couldn’t defend the decision to recommend Mauritius Telecom, “this is confidential,” he responded on phone.
“I am travelling and I have people with me so I can’t say much.”
Pressed on he added, “We were asked to make a report by those who are supposed to make a decision and that is what we did. Otherwise, I will not delve into the details,” Asubo said before hanging up.
TrumpetNews has also learnt that Minister Evelyn Anite backs the position of awarding the contract to Mauritius Telecom which has sparked off a protracted disagreement between her and the administrator Bemanya whose position is to consider Hamilton since it is the best evaluated bidder considering its huge capital investment and assets.
When contacted by this website, Minister Anite described Hamilton as ‘thugs’ who don’t have money to run UTL reason she considers Mauritius as genuine as per the Financial Intelligence Report.
“The companies were 6 and Afrinet wrote to me that it was pulling out. They remained five,” she said.
“Hamilton is for a Muganda man who doesn’t have monet. Financial Intelligence Report indicates that the company doesn’t even have clear book of accounts. That is why I am fighting to see that UTL isn’t taken by thugs,” she reiterated.
Asked why she wouldn’t consider the other remaining three firms since they are still considered better than Mauritius, Anite said, that the FIA’s report punches holes in all the companies apart from Mauritius Telecom.
“Now that Neubacher Montage LLP belongs to Sam Kutesa and FIA found out that it is a starting company which doesn’t have money,” said Anite.
“Ugandans should decide whether their company should go to thugs,” she concluded.
