Uganda’s Observer Newspaper put up for sale amid financial struggles

Kampala, (UG):- The Observer, one of Uganda’s most respected newspapers known for its in-depth analysis, is up for sale, BbegMedia, an online news outlet broke the news on Wednesday.

Pius Muteekani Katunzi, the newspaper’s managing director, reportedly confirmed to BbegMedia that discussions were underway with multiple potential buyers from Uganda and Kenya, but “no agreement has been finalized due to unresolved issues.”

“We’ve been speaking with a couple of people… but nobody has been settled on yet because there are matters to sort out,” Katunzi was quoted by Bbeg Media on Wednesday.

Katunzi emphasized that while The Observer hopes to retain its editorial independence, financial difficulties have forced the sale. “We’d love it to stay as it is, but honestly, we need the money,” he admitted.

This publication understands that negotiations have reportedly been complicated by differences over ownership terms.

While some interested buyers are pushing for full control, the newspaper’s current shareholders prefer to retain a minority stake. This situation mirrors a past deal in the early 2000s when shareholders of the Daily Monitor sold a majority stake to Kenya’s Nation Media Group but retained a small share.

Sources familiar with the talks estimate The Observer’s sale price at approximately 1 billion Ugandan shillings ($270,000), with a significant portion expected to go toward settling debts.

The valuation is said to reflect the newspaper’s brand reputation rather than its physical assets, with any remaining funds to be distributed among shareholders.

NRM bigwig emerges as Potential Buyer

As the hunt for a prospective buyer continues, key among the shortlisted potential buyers is Steven Magomu, a former journalist turned businessman and a prominent figure in the ruling National Resistance Movement (NRM) in Bugisu.

Sources quoted by BbegMedia indicate that Magomu has potentially reached a tentative agreement with The Observer, though Katunzi downplayed his involvement, stating that he is “just one of many candidates.”

Magomu, who previously served as The Observer’s Mbale correspondent in 2011 and now operates an import and manufacturing firm, could not be reached for comment, but sources close to him suggested that negotiations were progressing well, with several key points already agreed upon.

Declining Print Sales and Financial Struggles

Over the past five years, The Observer has faced mounting financial difficulties, attributed to a weak economy that has reduced advertising revenue and a significant drop in print circulation.

The rise of digital platforms such as X (formerly Twitter), Instagram, and TikTok has further drawn younger audiences away from traditional print media.

Founded in March 2004 by former Daily Monitor journalists, The Observer was the brainchild of John Kevin Ogen Aliro, who passed away in 2005. Other founding members included James Tumusiime, who left in 2020; Pius Katunzi; Ibrahim Ssemujju Nganda, now a politician.

Others are; Hassan Badru Zziwa; Carolyne Nakazibwe; Elizabeth Kameo, who exited in 2006; Linda Nabusaayi, who left in 2007; Fideri Kirungi; Sarah Namulondo, (deceased) and Abbey Mukiibi.

At its peak, The Observer sold between 18,000 and 20,000 copies weekly, but industry sources now estimate circulation at fewer than 4,000 copies per week.

As discussions over the sale continue, the fate of one of Uganda’s leading independent newspapers remains uncertain.

Original report by Edris Kiggundu of Bbeg Media