Cross-listed company Umeme has raised hopes of a return to trading at the Nairobi and Kampala bourses next month after holding negotiations with the Ugandan government over the disputed payout amount accruing from its power distribution concession that ended in March.
In a notice dated May 14, Umeme said that it had agreed to a Uganda government request to extend the 30-day good faith negotiation period by a further 10 days, indicating that the two parties might come to an agreement without resorting to an arbitration process in London.
The negotiation window was open between April 11 and May 10, with the company and the government holding the talks between May 2 and May 9.
In the meantime, Umeme has said it will publish its financial results for the year ended December 2024 on May 31 as directed by the Uganda Securities Exchange (USE), whether or not the good faith negotiations have been concluded.
“The board at its meeting held on May 12, 2025, and as requested by the government of Uganda, approved the extension of the ongoing good faith negotiations until May 20, 2025,” said Umeme in its latest notice on the matter.
“It is anticipated that the suspension of the Umeme counter will continue until the financial statements have been published on May 31, 2025.”
The Umeme stock has been suspended from trading since March 31, initially for two weeks before the respective capital markets regulators of Uganda and Kenya extended the trading freeze.
The latest extension was announced on Monday for a further 30 days, with the Nairobi Securities Exchange (NSE) saying in its notice that the freeze would remain in place until June 12, “or such other period as may be determined by the Capital Markets Authority (CMA)”.
At the time of suspension, the stock was trading at Sh16 per share at the NSE.
The firm, which has been cross-listed on the NSE since December 2012, was operating a 20-year electricity distribution concession, which expired on March 31.
As per the terms of the agreement, the company handed back assets and operations of the power network to the government on the last date of the concession, but a dispute arose over compensation for the value of unrecovered capital investments that was due to be paid to the shareholders by the government.
Umeme submitted a final buyout demand of $234 million (Sh30.2 billion), equivalent to Sh18.63 per share. But the Uganda government authorised a payment of $118.39 million (Sh15.3 billion), or Sh9.43 per share, hence the dispute.
The company’s last published register showed that by the end of 2023, it had a total of 6,543 shareholders, 5,068 of whom held 10,000 shares or fewer each.
The top 10 shareholders of the company, who include Uganda’s national social security fund and the World Bank’s International Finance Corporation (IFC), held 1.25 billion shares, equivalent to 76.8 percent of the company’s 1.62 billion issued shares.
