WASHINGTON, D.C., December 1, 1998 ---
The government of Uganda has invited an international consortium to begin
negotiations for the sale of 51 percent of Uganda Telecom Limited, the
state telecommunications company. The International Finance Corporation
has acted as the financial advisor to the government through the restructuring
and privatization process.
The consortium -- comprising WorldTel, the International Telecommunication
Union's investment fund, and Detecon, a Deutsche Telekom subsidiary --
was the sole bidder in an international tender for the shares, bidding
a total of US$23 million in cash and deferred payments
This sale of a majority share of Uganda Telecom to a qualified strategic
investor is the final stage in the government's restructuring program for
the telecommunications sector which split up the former Uganda Posts and
Telecommunications Corporation into three business entities, created an
independent regulatory agency, and licensed a Second National Operator.
Mr. Reyaz A. Ahmad, Manager of IFC's Corporate Finance Services Department
said this was a good outcome for Uganda, especially at a time when African
countries are competing for a limited pool of international investors.
Although not yet final, the deal demonstrates that international
investors recognise the potential of the emerging telecom markets in Africa,
IFC, part of the World Bank Group, fosters economic growth in the developing
world and emerging market economies by financing private sector investments,
mobilizing capital in the international financial markets, and providing
technical assistance and advice to governments and businesses. IFC's
Corporate Finance Services Department provides financial advisory services
for strategic sales and privatizations.