Uganda to sell 60% of Utel to Rowad Capital for $225m
TLDR
- Uganda Telecommunications Corporation Limited (UTel) secures $225 million investment from Rowad Capital Commercial (RCC) LLC, a global contractor.
- UTel, Uganda's national telecom provider, faced financial difficulties, leading to court-appointed administration and ownership by the Ministry of Finance and Ministry of Information and Communications Technology.
- This investment agreement involves UTel ceding 60% of its shares to Dubai-based Rowad, aiming to revitalize the telecom sector with an initial $225 million injection.
Uganda Telecommunications Corporation Limited (UTel) is poised to receive a $225 million investment from Rowad Capital Commercial (RCC) LLC, a global engineering and construction contractor.
Established as Uganda's national telecom provider in April 2021, UTel faced financial difficulties, leading to the relinquishment of its assets and operations in November 2022 and its subsequent placement under court-appointed administration.
Currently owned by the Ministry of Finance and the Ministry of Information and Communications Technology, UTel has agreed to cede 60% of its shares to the Dubai-based Rowad. The investment is expected to revitalize the telecom sector with an initial $225 million injection from Rowad.
Key Takeaways
The $225 million investment in UTel could significantly alter Uganda's mobile telecommunications landscape. As the third-largest telco in the country, UTel had an estimated 805,000 subscribers at the end of Q2 2024. This substantial capital injection might enable UTel to enhance its infrastructure, expand its market share, and compete more effectively with industry giants like MTN Uganda, which leads with over 20.4 million subscribers, and Airtel Uganda, with nearly 18 million users. Lycamobile Uganda, the smallest player with less than 82,000 subscribers, may also face increased competition as UTel strengthens its position. The deal could lead to more competitive pricing, improved services, and potentially drive innovation within Uganda's mobile telecommunications sector.
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