Umeme Ltd. on Monday said it had acquired a USD190 million (UGX 485 billion) long-term loan to expand and upgrade its energy distribution infrastructure. The capital investment program reportedly cost USD440 million (UGX1.1 trillion).
The financing is the largest private sector funding in Uganda to date, said Umeme in a statement. World Bank's International Finance Corporation and Standard Chartered Bank each provided USD70 million, while the Ugandan commercial bank Stanbic provided USD30 million.
According to Umeme, the funding would be used to reduce energy losses and increase access to electricity through new connections.
The energy distribution network plans to cut energy losses incurred in the distribution process. Umeme's planned upgrade could help reduce losses to the agreed regulatory target of 23% of energy purchased from last year's 26.1%, said Reuters.
Umeme was acquired by emerging markets private equity firm Actis Capital LLP in 2005. Actis recently signed an agreement to acquire American energy company AES' controlling interest in three power assets in Cameroon for USD220 million, said BusinessDay.
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