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Electricity distributor Umeme has issued a public notice to its shareholders, prospective investors, and the general public regarding the current status of its electricity distribution concession.
The notice follows a formal notice of dispute dated April 11, 2025, which marked the commencement of good faith negotiations between Umeme and the Government of Uganda. These talks are centered around three key issues, starting with the determination of the buyout amount following the end of Umeme’s concession.
According to the company, Umeme has estimated the buyout value at USD 234 million. However, after an audit by the Office of the Auditor General, the Government of Uganda recognized only USD 118 million creating a significant variance that the ongoing negotiations aim to reconcile.
Secondly, the negotiations are expected to facilitate the seamless handover of the electricity distribution system to the Uganda Electricity Distribution Company Limited (UEDCL) or a nominee appointed by the government.
Lastly, both parties are working to resolve their financial disagreements amicably to avoid lengthy and potentially costly legal proceedings.
In a statement, Umeme disclosed that during a board meeting held on May 12, 2025 at the request of the Government of Uganda it was agreed that the negotiation period be extended until May 20, 2025, to allow more time for a possible consensus.
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“The outcome of the good faith negotiation shall be communicated to the public,” the company said in the notice. “In the event that the negotiations do not yield a mutually accepted result, the matter shall be referred to arbitration in London.”
Furthermore, in line with the directive from the Uganda Securities Exchange, Umeme confirmed that it will publish its financial statements by May 31, 2025, whether or not the negotiations have been concluded.
The company also clarified that the current suspension of the Umeme counter will remain in place until the financial statements are released at the end of the month.
