Overview:
The move comes after negotiations over the buy-out amount for its 20-year concession failed to resolve the significant financial disparity.
Umeme Limited has announced its intention to pursue international arbitration in London to recover an outstanding claim of USD 292 million (UGX 1.11 trillion) from the Government of Uganda, following its concession exit.
The move comes after negotiations over the buy-out amount for its 20-year concession failed to resolve the significant financial disparity.
Umeme, whose concession concludes this year, stated in a public notice on Monday, June 2, 2025, that it was “dissatisfied” with the USD 118 million buy-out amount already paid by the government. The company formally issued a Notice of Dispute on April 11, 2025, leading to negotiations held from May 2 to May 20.
While these discussions reportedly resolved and agreed upon certain payable amounts, a core disagreement persisted over Umeme’s total claim, which stands at USD 292 million above the initial payment.
“Despite our best efforts in good faith negotiations, a mutual agreement on the full and fair value of our investments could not be reached,” said Umeme in a statement.
“We believe arbitration is the necessary next step to ensure our shareholders’ interests are protected and all outstanding sums are recovered as per the concession agreements,” it added.
The Office of the Auditor General is currently auditing Umeme’s 2025 investments, which, if admitted and paid by the government, would reduce the company’s claim.
“The government remains committed to a fair and transparent process,” stated a government official, who requested anonymity due to ongoing sensitive discussions. “We are awaiting the Auditor General’s report on Umeme’s recent investments, which will be crucial in determining the final figures.”
However, with no full resolution reached, Umeme’s Board of Directors has decided to initiate arbitration in London, as stipulated in the original Concession Agreements, to seek full recovery of all outstanding sums. The Arbitration Dispute Reference is expected to be served on the government “in the coming days.”
The ongoing dispute has also impacted Umeme’s financial reporting. The company has sought a further extension from the Uganda Securities Exchange to publish its 2024 financial results, now expected by June 12, 2025, due to the delayed negotiations and ongoing reconciliations. Consequently, the involuntary suspension of Umeme’s counter on the Uganda Securities Exchange has been extended until the same date.