Court halts Orange Telecom management transfer deal

Friday September 26 2014



Court has halted the transfer of majority shareholding to new management of Orange Telecommunications Uganda Limited until a dispute over retirement benefits is resolved.
High Court Judge Lydia Mugambe issued the temporary injunction restraining the transfer of the 95.3 per cent majority shareholding from Atlas services, Belgium to Africell Holding.
“Temporary injunction is hereby issued restraining the respondent (Orange Telecom), its officers, employees, agents, successors, assignees, any person claiming under it from transferring its majority shareholding to another company and or transferring its operating licences until disposal of the main suit,” the judge held.
The order follows an application in which more than 400 former employees of Orange Telecommunications Uganda Limited asked court to temporarily block the transaction until their dispute is resolved.
The former workers; Medhie Mayanja Kasule, Livingstone Mukwaya and Khalid Isaac Musiige representing others, through their lawyers led by Mr Owen Murangira, argued that if the arranged transfer was not halted, their case will be rendered insignificant.
But Mr David Mpanga representing Orange Telecom had asked court to disregard the application for lack of merit because the transaction they sought to block was between two separate parties who are independent of the case.
However, Justice Mugambe held that there were questions to be determined by court since the two parties had signed contracts inherited by Orange Telecom when it took over Hits Telecom.
The case was filed amid the ongoing process by the Orange Telecom to transfer more than 95 per cent of the shares through its majority shareholder to another company, Africell Holding.
The majority shareholder in Orange Uganda, sold part of its shareholding in the company in May this year to Africell Holding at an undisclosed value.
Orange Telecoms entered the Uganda market in 2008 through a partnership with Hits Telecom Uganda, in which it bought a 53 per cent stake.