Parliament Votes to Eject Ivan Kyayonka from NSSF Board

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In short
In 2012, NSSF bought 131 million shares in the Initial Public Offer-IPO in Umeme making it the third largest institutional investor with 14.27% shares.

Parliament has overwhelmingly voted in support of the removal of Ivan Kyayonka, the board chairperson National Social Security Fund -NSSF for his role in the purchase of shares in Umeme.

NSSF bought 131 million shares during Umeme's Initial Public Offer-IPO in 2012, making it the third largest institutional investor with 14.27% shares.
 
However, a select committee appointed to investigate the purchase of the shares said the NSSF board chairperson flouted investment procedures when he sanctioned the acquisition without the board's involvement and approval from the Solicitor General. 
 
According to the committee, Kyayonka rushed to purchase UMEME shares because the proceeds would go to the independent thermal power producers (IPP), the suppliers to UMEME, who would then pass on the money to Shell, where he was a director. 
 
As a result, MPs have voted recommending the removal of Kyayonka as NSSF board chair. They also voted recommending that Geraldine Ssali, the Deputy Managing Director be reprimanded for her role in sanctioning the purchase of the shares.

//Cue In: The committee recommends…
Cue Out:…ayes have it//
 
Earlier, the Attorney General, Fred Ruhindi had revealed to the House that NSSF only got clearance from the Solicitor General for the secondary share purchase in 2014 and not the IPO. Ruhindi accuses most of the government agencies of not sending in their requests for legal advice early, which creates such situations.

//Cue In: There was…
Cue Out:…attended to//

The committee recommended that Kyayonka and Managing Director, Richard Byarugaba be compelled to make good the shillings 56 million loss the fund incurred resulting from the sale of Plot 434, Kibuga Block4, on Namirembe Road.
 
The MPs contend that NSSF sold the land at Shs. 650 million, below the initial purchase price of Shs. 706 million bought in 2008. Reacting to the MPs' recommendations, NSSF MD Richard Byarugaba maintained that the UMEME share purchase was a viable investment decision made by the board. 

//Cue In: This is one…
Cue Out:… to make money //
 
The legislators further voted that the management of Capital Markets Authority board be reprimanded for their complacency in failing to do due diligence that would have safeguarded the interests of Ugandans in the concession agreement.

 

About the author

Olive Eyotaru
Olive Eyotaru is a URN journalist based in Kampala. Eyotaru has been a URN staff member since February 2015.

Eyotaru started practising journalism while still studying at Uganda Christian University. She was a reporter with Ultimate Media Consult Ltd between 2005 and 2007.

In 2009, Eyotaru joined Monitor Publications Limited, under KFM Radio as a parliamentary and business reporter. Consequently, Eyotaru started writing for the Daily Monitor newspaper until January 2015, when she moved to URN.

She is interested in reporting about politics, health, human rights, business and sports.