Norwegian company buys Shs337b Bujagali shares
An engineer takes a shot of the Bujagali power project recently. FILE PHOTO
What you need to know:
Deal. The buyer and seller have met the President over the sale.
Kampala. SG Bujagali Holdings Limited (SGBHL) will bag no less than $100m (Shs337b) from the sell of its shares to SN Power AS.
Should the energy regulator approve the deal, SGBHL will sale 49, 750 Class A Ordinary shares and 1, 117, 510 Class B redeemable preference shares.
Though the nominal value of each share is Shs100, a financial analyst who requested anonymity to speak freely, said each share would go for a premium of not less than $85 (Shs286, 705).
Though SGBHL did not offer an explanation for selling its interests to SN Power AS, according to some accounts, “that is its business model”.
About SGBHL
SGBHL is an affiliate of Sithe Global Power LLC – an American company that develops, constructs, sometimes acquires and operates electricity generation facilities.
SGBHL builds electricity plants, test runs them, see them commissioned and it sells its shares at a premium.
The company is one of the three major shareholders of Bujagali Energy Limited (BEL), the operator of the 250-megawatt Bujagali hydropower plant in Jinja, 80 kilometres east of Uganda’s capital city Kampala. The other two shareholders are Uganda’s minister of Finance (on behalf og government), who holds 360, 000 Class C Ordinary shares and Bujagali Holding Power Company.
Bujagali Holding Power Company (the Industrial Promotion Services (IPS) of the of the Aga Khan Fund for Economic Development) has 50, 250 Class A shares and 581, 350 Class B redeemable preference shares.
The Minister of Finance and Bujagali Holding Power Company are not selling their shares, neither is BEL transferring its power generation licence.
Just last month, SGBHL and SN Power AS officials met President Museveni in Kampala over the sale of shares.
Through this deal, SN Power AS saves itself waiting with bated breath for Electricity Regulatory Authority (ERA)’s assessment of the company’s ability to construct an electricity plant.
Like the other investors, should the SGBHL–SN Power AG get ERA’s nod, SN Power AS will be earning a 19 per cent return on investment.
But it might think about how promptly the Uganda Electricity Transmission Company Limited (UETCL), the sole buyer of bulk electricity from the power generation plants, will be paying for BEL’s power.
For the paper and administrative work though, ERA will get about $3, 500 (Shs11.8 million).
The money will go to placing notices in the media about the deal.
Uganda, through Uganda Revenue Authority, gets a yet to be computed sum in Capital Gains Tax.
