Uganda’s UTel gets $225m boost from Dubai’s Rowad Capital

KAMPALA, UGANDA – Uganda’s troubled state-owned telecom provider, Uganda Telecommunications Corporation Limited (UTel), is set to receive a $225 million investment from Dubai-based Rowad Capital. The deal, finalized last week, will see Rowad Capital acquire a 60% stake in UTel.

UTel, established in April 2021, has faced financial difficulties, leading to a court-appointed administration in November 2022. Despite its challenges, UTel boasts an estimated 805,000 subscribers as of Q2 2024. However, it lags behind market leaders MTN Uganda (20.4 million subscribers) and Airtel Uganda (nearly 18 million users).

The substantial investment aims to enhance UTel’s infrastructure, expand its market share, and drive innovation. However, it remains to be seen whether UTel can effectively compete with the dominant players in the market.

The deal may also impact Lycamobile Uganda, the smallest player with fewer than 82,000 subscribers. Clear plans for UTel’s future have yet to be unveiled.

Rowad Capital Commercial LLC, a leading global engineering and construction contractor, has successfully completed over $3 billion worth of projects across various sectors.

This investment marks a significant turning point for UTel, and industry observers will be watching closely to see how the company leverages this funding to revitalize its operations and compete in Uganda’s competitive telecom market.