Kampala, Uganda | THE INDEPENDENT | The Capital Markets Authority expects to reap Non Tax Revenue of 1.15 billion Shillings from the listing of telecom giant MTN Uganda on the Uganda Securities Exchange. This was disclosed by the Chief Executive Officer of the authority Keith Kalyegira while appearing before the Finance Committee of Parliament on Wednesday afternoon.
The meeting chaired by the vice-chairperson of the committee Jane Pachuto was called to discuss the performance of the authority as the committee prepares to receive the policy statements of Ministries Departments and Agencies.
Agule County MP Francis Mukula had asked Kalyegira to explain the funding gaps that the authority is experiencing. In his explanation, Kalyegira pointed out that the authority only has an annual budget of 6.1 billion Shillings, but expects to increase that to 7.25 billion Shillings in the next financial year 2021/2022 following the listing of one telecom company.
Although he declined to disclose before MPs the name of the telecom, he later told URN that MTN Uganda is one of two telecoms that has come forward to fulfill its obligation to float shares within the required two years of renewing its license. Kalyegira notes that the additional 1.15 billion Shillings will be obtained from non-tax revenue that the authority expects to receive from the listing of MTN Uganda and the resultant trading commissions in the market.
Following a protracted negotiation that dragged on for nearly two years, MTN Uganda finally reached an agreement for a long-term renewal of its operating license in Uganda. MTN Uganda reached an agreement with Uganda Communications Commission to pay USD 100 million for a 12-year license in Uganda valid from July 1, 2020.
An initial public offering was one of the conditions for the renewal of the license. According to reports, MTN Uganda is expected to list at least 20 percent of its shares. MTN Uganda reported a 9.1 per ent increase in net profit to 442.6 billion Shillings for the first six months of 2020.
The performance was driven by the strong performance of mobile money, data and digital income. Overall, the company’s revenues grew by 7.6 percent to 900 billion Shillings in the period while data incomes jumped from 128 billion to 167 billion Shillings representing a 30 percent growth.
A source disclosed to URN that the second telecom company expected to list on the USE within the next 18 to 24 months is Airtel Uganda.