UMEME Limited has officially declared a dispute with the Government of Uganda over the Buy Out Amount payable to the electricity distribution company, a move likely to trigger legal and financial implications for both parties and investors.
According to a Public Notice issued by the Board of Directors of UMEME on April 14, 2025, the company invoked dispute resolution clauses under the Support Agreement signed with the government, citing a disagreement regarding the financial terms of the Buy Out Amount. The dispute notice was served to the Ministry of Finance, Planning and Economic Development on April 11, 2025.
“In accordance with clauses 9.1 and 9.2 of the Support Agreement entered between Umeme Limited and the Government of Uganda, and pursuant to the resolution of its Board of Directors, Umeme has identified and formally declared a dispute in respect of, inter alia, the Buy Out Amount payable to the Company,” the notice stated.
UMEME indicated that the disagreement is rooted in interpretations of the Concession Agreement and will undergo the structured dispute resolution process outlined in the agreement.
“As stipulated in the dispute resolution clauses of the Concession Agreements, the Parties shall attempt in good faith to settle such Dispute within thirty (30) days commencing from the 11th day of April 2025,” the statement added.
If the dispute remains unresolved within the 30-day window, it will be escalated to arbitration in London, in line with international arbitration norms.
“In the event that no agreement is reached within the thirty (30) days, or such further period as may be agreed upon between the parties, the matter shall be referred to arbitration in London.”
Investors and the public have been advised to exercise caution when dealing in UMEME shares during this period of uncertainty.
The announcement, issued by UMEME’s legal representatives, Shonubi, Musoke & Co. Advocates, was made in compliance with Rule 36 and 38 of the Uganda Securities Exchange Listing Rules, 2025, and applicable Kenyan Capital Markets regulations.
