Image Credit: East African Van Guard
Image Credit: East African Van Guard

Ugandan government has Wednesday announced takeover of management of Uganda Telecom Limited (UTL) and all its affairs.

The announcement was made in a statement by Minister of Finance and Economic Planning Hon Matia Kasaija following the withdrawal of the company’s major shareholder, Ucom Ltd.

According to Kasaija, Ucom Ltd, a Libya based company also ordered resignation of all five of their Libyan representatives on the UTL board of Directors.

Ucom is a subsidiary of LAP Greencom Network, a subsidiary of Libya Post Telecommunications and IT company (LPTIC) which is wholly owned by the Libyan government.

Kasaija noted that Ucom has been responsible for management of UTL since they were the majority shareholder but “their performance since 2007 has been characterized by indebtedness, decline in market share and losses.”

He however assured customers, stakeholders and the general public that the company would remain operational with full support from government despite the takeover.

“Government considers UTL to be of strategic importance, it is a key provider of fixed line services and datato government ministries Departments and Agencies,” noted Kasaija.

“It employs over 500 Ugandans directly and thousands more indirectly as service providers,” he added.

According to Kasaija, UTL is also a major tax payer and “between 2006 and 2017, UTL has paid approximately Ushs 217 billion in taxes and Ushs 53.3 billion in regulatory fees to Uganda Communications Commission.”

The company has also over the time accumulated debts and losses that caused to sell off their assets.

Among the debts UTL is struggling with include Shs 22.244 billion with regulator UCC arising from unpaid spectrum fees, Shs 8bn in interconnection fees to MTN, Shs 58.424 billion in accumulated tax to URA for the period between May 2015 – Dec 2015.

Also a total of US $7.06 million (24.244 billion UGX) is owed to Huawei Technologies Limited which supplied equipment, spares and services to the telecom under LAP Group.