PARLIAMENT, UGANDA: Capital Markets Authority has sought the intervention of the finance committee of parliament to compel five major companies to list their shares on the local exchange stock market.
The companies are Absa Bank formerly Barclays Bank, Tororo Cement, Apolo Hotel currently Sheraton Hotel, Kakira Sugar and Windsor Lake Victoria Hotel.
Keith Kalyegira, the Chief Executive Officer Capital Markets Authority says the companies undertook to list their shares on the local stock market during the privatization process in 2000 and 2001, but they have not compiled to date. The officials had appeared before the committee led by the State Minister of Finance for General Duties, Gabriel Ajedra to present their performance report for the financial year 2019/2020.
Kalyegira revealed that several people have approached the authority expressing interest to invest in the companies but they have never listed their shares. According to Kalyegira, they have held several meetings with the company officials over the same, but they often make excuses claiming that the economic environment is not viable for them to go public.
He says that they have approached the Finance Ministry to compel the companies to fulfill their obligations. “The Ministry should review them and establish how far they have fulfilled the conditions of the sale agreements during privatization,” he said. Kalyegira revealed that MTN is part of the two telecom companies that have promised to list shares within 18 to 24 months.
Asked about the second company, he said that this was still under negotiations but they expect the two to boost the authority’s non-tax revenue by over 2 billion Shillings. Speaking about their achievements during the financial year, Kalyegira said that they reached 7,013 potential investors under their public education program which led to the number of collective investment schemes accounts to increase from 5,222 in June 2019 to 8,904 in June 2020.
Assets under management increased from 173.5 billion to 388.5 billion Shillings. He said that they also trained 300 police officers in investigating and prosecuting financial crimes. However, the Finance Committee vice chairperson Jane Pacuto queried the officials on whether Ugandans know about the authority, its contribution to the economy and whether capital markets are understood.
Kumi County MP Charles Illukor also expressed the same sentiments saying that many people could be ignorant about the authority yet they have money to invest. Kalyegira told MPs that one of their biggest challenges is the lack of funds to carry out public education.