Government appoints business adviser to assess UTL

Kampala. Cabinet has appointed PricewaterhouseCoopers (PwC), a multinational professional services firm, with headquarters in London, to assess the business viability of Uganda Telecom (UTL) and advise government on the action to be taken to save the company from collapse.
Cabinet sources told Daily Monitor that PwC was also given ‘stern’ instructions “to leave no stone unturned” in the impending audit of UTL operations.

The company has a maximum of 12 weeks to complete the task. PwC is still in the process of finalising the deal with the remaining UTL board of directors led by their chairman, Mr Stephen Kaboyo.
Acting on the Cabinet directive on Tuesday, Mr Kaboyo wrote to the country senior partner, PwC Ltd, communicating the government decision and asked the firm to furnish him with all the necessary documents to conclude the deal.
Mr Kaboyo referred to consultations with Ms Evelyn Anite, the minister for Privatisation and Investment, and William Byaruhanga, Attorney General.

“I have been instructed to engage PwC to assess UTL…,” Mr Kaboyo’s letter reads in part. “This is, therefore, to request you to avail me with a letter of engagement that will constitute the contract for the assignment. I have notified UTL management of your engagement and instructed them to accord you maximum cooperation during this exercise.” He added: “We expect a weekly update and will also request your availability to brief cabinet on the progress during the period.”
A senior official in the Ministry of Finance told this newspaper yesterday that Ms Anite on March 6 wrote to Mr Kaboyo and copied her letter to President Museveni, explaining the government decision to take over UTL. She also confirmed the appointment of PwC to audit the operations of UTL and advise government accordingly.

The minister also met UTL creditors and requested for more time to settle Shs700b to revitalise the company.
“Government has appointed PricewaterhouseCoopers to independently carry out a diagnostic review and structural assessment of UTL in order to determine how the company can be stabilised in the short run. PwC will also advise on the business viability and the key action that government should take to sustain the business” the minister’s letter reads in part.
Because of the special nature of the assignment, the minister wrote: “This is, therefore, to instruct you to issue PwC with an appropriate contract/ letter of engagement following review of the terms of reference that we reviewed on March 6 2017…” The minister also instructed the board to ensure that all the management decisions are approved.

“The inflows to all revenue accounts of UTL must continue. However, expenditures out of the accounts are subject to my prior review,” Ms Anite wrote, adding that to facilitate her directives, “UTL management should prepare an appropriate cash flow of critical activities for the duration of PwC’s assignment.”
To avert an imminent crisis and liquidation triggered by Libyan Post, Telecommunications and IT Company (LPTIC) departure, and to reassure customers and stakeholders, government last week took over the management of UTL.
This was after the Libyans on February 24 withdrew funding from UTL. The Libyans who controlled 69 per cent stake in the company also asked their representatives on the board to resign and blamed their woes on government.

The debt-stricken telecom where government owned 31 per cent stake is now on the verge of collapse should government failure to invest or find a risk-taker willing to inject in excess of $48m (more than Shs172.5b) into the company.
Ms Anite, however, said she was still consulting the Attorney General on how government can lawfully take over the 69 per cent shareholding of the Libyans.
The Ministry of Finance spokesperson, Mr Jim Mugunga, yesterday requested for more time to get the details of the PwC deal.
He, however, confirmed that the minister had met UTL creditors and requested them to give the government time to first streamline UTL operations.
The company, according to documents presented in Parliament in November last year, is stuck with a debt of Shs700b.

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