Government of Uganda has announced plans to buy 150,000 preferential shares from Roko Construction at a tune of UGX 202 billion ($53.2 million). SecretsKnown has established that each share is valued at UGX 57.6 billion ($15.1 million). The announcement has sparked debate across the country questioning the government’s intent is a ploy to defraud taxpayers.
It is imperative to note that the leaders of Roko Construction Company met president Museveni in 2019 and directed Ministry of finance to buy shares as revealed by ROKO’s managing director.
SecretsKnown notes conversely, that the Uganda Development Corporation (UDC) is advising government to conduct a thorough audit of ROKO’s list of creditors. It is understood that ROKO is indebted to various commercial banks and this information is for now being kept confidential. It is also purported that ROKO construction company is currently significantly indebted to a tune of UGX 202.4 billion ($53.3 million) as of 31st May 2022 as reported by Independent Magazine on July 8, 2022.
ROKO Construction Company has liabilities from bank guarantees to a tune of UGX130.9 billion Shillings while its indebtedness to financial institutions totals $ 35.7 million (Ugx 134bn). Government’s intention to buy shares in a firm indebted as this leaves Secrets Known and the citizenry puzzled and amused.
While presenting government’s interest to buy shares in ROKO, State Minister for Finance Henry Musasizi, told Parliament that Roko being cash strapped has affected various government construction projects such as the new chambers of Parliament of Uganda, the Inspectorate of Government, the Uganda Cancer Institute, and the Ministry of Finance.
ROKO currently has projects in hand with signed contracts worth UGX 1.064 trillion, of which UGX 696.6 billion are government of Uganda projects. Out of the UGX1.064 trillion worth of contracts, UGX 292 billion equivalent of construction works remain uncompleted. The consequence of the company’s collapse would therefore impact these projects negatively.
It is important to note that in the past, companies that were on the verge of bankruptcy and begged government for a bailout had their call in vain. Examples of these companies included the East African steel giant, Sembule Steel Mills Ltd, and Mukalazi Technical Services, and Zzimwe Construction Ltd. The question is; Why ROKO construction company?
SecretsKnown discovered that Roko Construction company has long ties with the National Resistance Army. President Museveni disclosed at the funeral of Max Rohrer, the co-founder of ROKO in 2005 that Rohrer met him in a foreign country and handed him a package containing a substantial sum of dollars in the early days of the bush struggle. Could government’s interest in saving ROKO be payback for their company’s contribution to the NRM in the late 80s?