NPA clears air over Uganda Airlines ownership

March 27, 2019 in Business, Companies, Infrastructure, Transport by Editor

The first two of an eventual fleet of four Canadair Regional Jets series 900 aircraft are now expected to arrive in Uganda mid-April

Ninety-nine percent of the stock in Uganda Airlines remains unsubscribed because it is being held in trust until the carrier is ready for listing on the Uganda Securities Exchange.

Responding to suggestions that a ‘mystery individual’ holds the majority interest in the publicly funded project, Mr. Moses Dhizaala, the Head of Monitoring and Evaluation at the National Planning Authority NPA, told 256BN that the decision to have the ministries of finance and works as the primary shareholders  was arrived at following advice from the Attorney General’s chambers.

“When the question of ownership came up at the inception of the national carrier project, the legal advice we got indicated that as long as there was a minimum of two subscribers to the share capital, Uganda National Airlines Corporation could be registered a public company. That is why the Ministry of Finance and the Ministry of Works were each given a single share so that the company could have legal effect,” Dhizaala said.

That left 99.9 percent of the stock open to subscription as  and when the revived national carriers financials qualify it for listing on the USE.

That arrangement has caused confusion with a section of legislators suggesting that the government was a minority shareholder in the project while a phantom figure owned the rest. The sensational claims are contained in a minority report by opposition MP’s on the House Budget Committee after the House passed UGX 280 billion in supplementary spending by the works ministry to support payments for the initial two airframes from Canadian systems integrator Bombardier.

The share capital of Uganda National Airlines Company Limited is 200 million divided into 2 million shares worth UGX 100 each. The Ministry of Works and Transport as well as Ministry of Finance are so far the only nominees to the company, each holding a single share equivalent to 0.0001pc of the stock. The two ministries which comprise the company’s board are represented by their respective permanent secretaries.

Dhizaala who is familiar with the national carrier revival project says it was conceived by the National Planning Authority and allegations of  the existence of phantom owners are unfounded.

Meanwhile, following legislative approval of additional funding, the Ministry of Finance was working to beat a Friday March 29, deadline to have the money deposited in Bombardier’s account. Preparations to dispatch the team to  receive the aircraft are also in high gear with a tandem delivery now tentatively scheduled for April 10.