MTN ON SPOT AS MP RUHUNDA FIGHTS TO SAVE HIS BUSINESS

By Our Reporters

Fort Portal MP Alex Ruhunda has dragged telecom giant MTN to court protesting the manner in which his dealership is being partially terminated in favor of another company called Black Knight Investments Ltd. For 18 years now, Daj Communications Ltd for which Ruhunda is majority shareholder has been handling the MTN dealership and carrying the responsibility to (at a commission) deliver all MTN services (Mobile Money, Airtime etc) to the larger part of Toro/Rwenzori region. This vast territory covers Mityana, Mubende, Kabarole, Kyenjojo, Ntoroko, Bundibugyo etc. This is home to millions of active telecom services users, the very reason Daj bosses have been reaping big at the end of the month. On the mobile money alone, the company (that is also responsible for thousands of the MM agents) has been taking 10% on all the commission made per month and the same goes for airtime sales. Besides Ruhunda, other Daj directors include businessmen Dennis Mugarra and Joseph Rwabuhinga (also ex-Fort Portal town clerk). For months now, Daj hasn’t been having a good time with MTN and things only escalated when Ruhunda led Toro sub region’s well pronounced opposition to the scrapping of age limit which was finalized with the Togikwatako voting in December 2017. This being Museveni’s Uganda, it was a matter of time before Ruhunda paid for his political sins. Characteristically, state functionaries had to come after his business territory which is why when the MTN CEO Wim Vanhelleputte started hardening on Daj, Ruhunda wasn’t that much surprised. Mid last year 2018, MTN started threatening to split the Daj territory the ground being the Shs700m the company hadn’t passed on promptly after doing the financial reconciliations. Ruhunda wrote many letters pleading for extension of time as the company worked out a workable payment schedule. This was at a time Daj (like any other company) was also struggling servicing a huge credit facility from a commercial bank. Their payment schedule was rejected by MTN and the CEO Wim cracked the whip on 19^th September 2018. On that day a letter came saying the talks had collapsed and MTN had unilaterally effected the decision to split Daj’s market territory into two. That is how Mubende and Mityana, which formed Daj’s largest market and business, were cut off and two days later (on 21^stSeptember) allocated to Black Knights Ltd which Ruhunda’s supporters have falsely been claiming belongs to a group of Museveni supporters led by Andrew Mwenda. We return to that shortly. Ruhunda, whose Daj has always made Toro proud by employing hundreds of would-be unemployed youths, determined not to go down without a fight. And he protested the MTN injustice by challenging Wim’s decision in Commercial Division of the High Court where his lawyers (The BOWMANS/AF MPANGA) have since secured an interim order permitting his Daj to continue being in charge of Mubende and Mityana market until the main suit (Miscellaneous Cause No. 53 of 2018) is disposed of. It was granted by Deputy Registrar Lillian Buchana. The matter comes up again on 16^th January 2019 and Daj is demanding billions of Shillings from MTN in damages and loss of reputation the sudden termination has occasioned. Ruhunda’s court matter could go a long way in exposing MTN’s political biases and imprudent business practices. This impending court scrutiny comes at a time MTN is on its knees begging UCC to relax on its tough conditionalities and compliance requirements that explain why the regulator extended their license only for a limited period pending satisfactory compliance. One of the requirements is for them to expedite the much-delayed IPO to enable local native Ugandans to have shareholding in the telecom giant. The other concern is for them to demonstrate readiness to comply with GoU local content requirements by increasing visibility of local Uganda talent in top executive management positions. There is also anxiety as stakeholders wait to see how the recent top executive reshuffles in the MTN headquarters South Africa will affect the Ugandan establishment. The timing of the Daj termination has also made MTN look not very good with critics construing it all as acquiescence to being used to politically fix a regime critic that Ruhunda has lately distinguished himself to be.

MWENDA & BLACK KNIGHTS

We at Mulengera news managed to carry out a search at URSB regarding Black Knights Investments Ltd’s incorporators and this is what we found. Unless he is owning it by proxy, Mwenda doesn’t appear anywhere on the company documents. The search results showed that the company was incorporated on 7^th July 2011. OS Kagere Advocates, a law firm, presented the papers applying for name reservation etc. Its offices are located on plot 258 Lubobo Close in Muyenga and the postal address is P.O Box 2633 Kampala Uganda. The registered directors are Abraham Ssali and Stephen Banage-both Ugandan citizens. Their lawyer is Dennis Kwizera of Ayigihugu & Co Advocates. The shareholding is as follows: Ssali has 333 shares, Stephen Banage 333 and Ronin Ventures Ltd 333 shares. For comments, call, text or whatsapp us on 0703164755.