Buyers of equity stake in MTN Uganda will be limited to East Africa

Buyers of equity stake in MTN Uganda will be limited to East Africa

According to Reuters, the Ugandan government has decided that the sale of a 20 percent equity stake in MTN Uganda will be restricted to East Africa.

A spokesperson for the telecommunication regulator, the Uganda Communications Commission (UCC), has apparently confirmed that the sale will be restricted to citizens of the East African Community trading bloc, which is composed of Burundi, Kenya, Rwanda, South Sudan, Tanzania and Uganda.

This may not be too much of a surprise, given that the Ugandan government now requires all the country’s telecommunications operators to list a fifth of their shares on the local bourse to allow local people to benefit from the sector’s profits. 

How MTN locally and as a group feels about this is not known. However, this announcement comes at the end what has certainly been an eventful month for MTN Uganda, during which it concluded the official signing of a License Renewal Agreement with the UCC. The telecommunication company is now able to continue its operations in the country for another 12 years, from a start date of 1 July 2020.

MTN Uganda provides telecommunications services under a Second National Operator License for the operation of a telecommunications system issued on 15 April 1998 for a period of 20 years. The license expired on 21 October 2018 but was extended to accommodate the conclusion of renewal negotiations, which continued for close to two years.

MTN Uganda is the largest telecommunications company in Uganda, with a customer base estimated at 12.6 million customers by the end of 2019. It is also, of course, a subsidiary of the multinational telecommunications company MTN Group.