The government of Uganda has announced it will not renew power distributor Umeme’s 20 year contract when it expires in March 2025.
Umeme released a statement to that effect.
Pursuant to Rule 36 (1) (a) and (b) of the Uganda Securities Exchange (USE) Listing Rules, 2021 the Company is required to amongst others disclose to its shareholders and the general public new developments in its sphere of activity which are not public knowledge and which may lead to material movements in the ruling price of its listed securities.
As disclosed in its Prospectus at the Initial Public Offering, subsequent Annual Reports and Public Disclosures, Umeme Limited holds a 20-year Concession from the Government of Uganda, whose natural term expires on 30th March 2025. The concession is enshrined in several binding Concession Agreements.
The Company has formally received written communication from the Government of the Republic of Uganda, notifying it that the current Concession will continue to run until its natural end in March, 2025 as stipulated in the Concession Agreements after which, there will be no renewal.
The Company remains committed to performing its obligations as per the existing Concession Agreements and will continue to operate and maintain the electricity distribution system in line with prudent utility practice to ensure continued service delivery through to the end of the Concession.
