The financially-limping Uganda Telecom Limited, UTL, can bounce back to profitability by exploiting its niche product, landlines, according to the minister of state for Planning, David Bahati.
Appearing before parliament’s select committee inquiring into the mismanagement at UTL on January 19, Bahati said government is aware of the Libyan part-owned telecommunications service provider’s financial troubles.
“This company is on financial oxygen but it isn’t dead and it can be rescued based on the new business plan and obligations we are to put to the majority shareholders,” he said.
UTL’s troubles spilled into the public domain mid-November, 2016, when Budadiri West MP Nathan Nandala-Mafabi presented a dossier detailing management flaws and a Shs 670bn debt. It led to the constitution of Parliament’s a select committee.
Bahati also told the Chwa West MP Philip Okin Ojara-led committee that government is working on a new business plan to convince the Libyan government to reinvest in the company.
“We are thinking of turning the debt into equity so as to increase our shareholding capacity,” he said.
In December, UCC man- aging director Godfrey Mutabazi said UTL was dead and there was little hope of reviving it. Nandala questioned the decision to abandon the earlier business plan adopted when Libyans took over the company.
Mafabi said the old plan was rendered irrelevant with changes in technology and other market trends, necessitating a new plan.
Uganda owns 31 per cent of the company while the Libya African Portfolio Green owns 69 per cent. Ac- cording to the shareholders’ agreement, the Libyan government was supposed to invest $ 18m, but they didn’t.
Bahati said the Libyans told the Ugandan government that they failed to deliver on their end of the bargain due to the UN sanctions slapped on the Libyan Government following the 2011 Arab Spring that led to the ouster of Libyan president, Muammar Gaddafi.
However, Committee Chairperson Ojara argued that the information in his possession showed that UTL was not listed any- where among companies affected by the UN sanctions.