Company profile: Umeme Limited

Umeme Limited is the main electricity distribution company in Uganda. Umeme entered a 20-year concession arrangement with the Government of Uganda effective March 1, 2005 to run the country’s distribution network using assets of the Uganda Electricity Distribution Company Limited.

The concession came after reforms in the electricity sector that led to the disbandment of Uganda Electricity Board. Umeme was licensed to distribute and supply electricity to customers, under the regulation of Electricity Regulatory Authority.

In March 2014 Parliament passed a resolution to cancel the concession over concerns about the value of the agreement and revelations that its signing might have been done outside constitutional provisions. The resolution was not binding to the government and has not been implemented but it represents a risk to investors.

There are many public queries over the amount of new investment in the electricity grid, the level of electricity losses, and the status of an escrow account meant to provide a financial buffer to Umeme in case of default by the Government of Uganda.

Umeme’s agreement with GoU provides for termination of the agreement by either party with a buy-out amount payable to it in such a scenario. By the end of 2015 the buy-out amount had risen from $249.5m the previous year to $315.7m, according to the company’s financial report, inclusive of $152.7m in investments that were yet to be approved by the Electricity Regulatory Authority.

The company is listed on the Uganda Securities Exchange and cross-listed on the Nairobi Securities Exchange. The largest shareholder is Uganda’s pension fund, National Social Security Fund after the exit of private equity fund, Actis.

Actis, an emerging markets investor which fully owned Umeme Holdings Ltd offloaded 232.21 million shares (14.3%) in November 2016, completing their exit from the company. NSSF bought majority of their stake.

Umeme’s customer base hit 1,000,000 in May 2017.

Employees
1472 (as at December 2017)

Total Tax Contribution

Shs66,307,152,305 (2014)
Shs78 billion (2016)
Shs72 billion (2017)

Key people

NameTitle
Patrick BitatureNon-Executive Director/Chairman
Selestino BabungiManaging Director
Samuel ZimbeDeputy Managing Director
Florence Nakimbugwe NsubugaChief Operations Officer
Marie Nassiwa MartinChief Finance Officer

Largest shareholders (as at December 2017)

InvestorEquity stake
National Social Security Fund23.2%
Allan Gray9.6%
Kimberlite Frontier Africa Master Fund8.3%
Investec Asset Management Africa4.4%
Utilico Emerging Markets Limited4.3%
The Africa Emerging Markets Fund3.9%
International Finance Corporation2.8%
Coronation Global Opportunities Fund2.6%
Imara S P Reid (Pty) Ltd2.5%
Duet Fund2.5%
Others36%

Website
http://umeme.co.ug/