Uganda's power distributor plans IPO to raise investment capital

Umeme, the only power distribution company in Uganda, plans to list this year on the Uganda and Nairobi stock exchanges to raise capital to finance the much-needed development of the country's electricity network system, report Reuters.

Charles Chapman, managing director of Umeme, said the company opted for an initial public offering (IPO) because of the increase in the availability of electricity and there was an agreement over regulatory targets.

The company has not finalised its IPO plans and would not comment on the amount of money it hopes to generate but a source told Reuters it is likely to list 20 per cent of its shares.

"The initial public offering will support Umeme's capital raising initiatives to finance the continued development of the electricity distribution network, including projects such as prepayment metering and energy loss reduction," said Chapman.

The company holds a 20-year electricity distribution concession in east Africa's third-largest economy, and is 100 per cent owned by the pan-emerging markets private equity firm Actis.

Uganda suffers from a chronic power supply deficit, estimated at around 130 MW, which has slowed its economic growth.

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