State has major shares in UDA

KATARE MBASHIRU in Dodoma

AFTER years of speculation, the government has finally revealed before a parliamentary committee that it now owns a large stake in Usafiri Dar es Salaam (UDA) after it regained unallotted shares that were controversially sold.

A team of government officials told the Local Authorities Accounts Committee (LAAC) that out of the 15,000,000 UDA shares, the government has 11,368,954 against the 3,631,046 that are currently owned by Simon Group.

Led by a Minister of State in the President’s Office, responsible for Regional Administration and Local Government, Mr George Simbachawene, senior government officials appeared before the LAAC after the committee summoned them to explain the controversy surrounding UDA, including revealing the names of the shareholders of Simon Group of Companies.

He was flanked by Treasury Registrar (TR) Lawrence Mafuru, Attorney General (AG) George Masaju and Dar es Salaam City Mayor, Issaya Mwita, among others. Last Tuesday, LAAC summoned top government officials to appear before the committee to explain why Simon Group, whose Chairman and Chief Executive Officer (CEO) is Mr Robert Kisena, became one of the shareholders in UDA.

The committee members wanted to know how Simon Group acquired a stake in UDA, after the city council’s economist, Ms Sara Yohana, gave clarifications that failed to convince the lawmakers.

According to her, Simon Group acquired un-allotted shares at a contract price of 7m/-, after which he was given powers by the UDA Board of Directors to supervise the city’s public transport company as a big shareholder.

Simon Group is the company that controversially bought the city’s public transport company, UDA, through which it became the main shareholder of UDART, currently operating the Bus Rapid Transit (BRT) that have revolutionalised Dar es Salaam’s congested transport system.

After the closed door session of the committee meeting, its chairman Vedasto Ngombale-Mwiru told journalists that the government told his committee that it had regained the un-allotted shares that were controversially sold to Simon Group.

“My committee has been informed that the un-allotted shares that were initially owned by Simon Group are now fully owned by the government,’’ he said, adding that the shares were repossessed after a fierce legal battle between Simon Group and the government.

According to the Controller and Auditor General (CAG) report ending June 2015, UDA had authorised share capital of 15,000,000 shares at par value of 100/- per share,

of which, only 47.5 per cent shares (7,119,697) were issued out of which 51 per cent shares (3,631,046) to Dar es Salaam City Council (DCC) and 49 per cent shares (3,488,651) were issued to the Government of Tanzania.
The remaining 52.5 per cent of total authorised shares (7,880,303) were un-allotted and subsequently sold to Simon Group Limited by UDA Board of Directors in a controversial manner. This means the government has the largest stake in UDA, unlike earlier claims that Simon Group was the major shareholder of the city’s public transport company.
In order to prove beyond reasonable doubt that the shares are owned by the government, LAAC chairman directed the Treasury Registrar (TR) to submit within two weeks the three crucial documents before his committee. They are a Memorandum of Association, an Article of Association and a Certificate of un-allotted shares.
The TR further revealed the names of the shareholders of Simon Group, among them is former cabinet minister, Juma Kapuya, who owns 10,000 shares.
Others, according to LAAC chairman, are Robert Kisena (94,000 shares), Simon Robert Kisena (20,000 shares), Gloria Robert Kisena (20,000 shares), Kulwa Robert Kisena (10,000 shares), Wiliam Simon Kisena (10,000 shares) and George Robert Simon (5,000 shares).
The committee further demanded clarification from the AG to issue clarification on the 4.6bn/- deposited at the Bank of Tanzania (BoT), that were obtained after the Dar es Salaam City Council (DCC) sold its shares to Simon Group.
There is a protracted legal battle between DCC and the city’s councillors that maintains that the shares were sold illegally, therefore the councillors believe they still belong to DCC. In UDA shares, the DCC owned 51 per cent while the Treasury owned the remaining 49 per cent.
The city council sold its shares in 2013 and currently the money that the council received (4.6bn/-) is deposited at the Bank of Tanzania (BoT). Yesterday, the AG told LAAC that he would issue a legal advice in writing to the committee concerning the ongoing legal tussle.
The Treasury Registrar said the UDA saga should remain a lesson, maintaining that team work was important in the government. “If we had worked together, what we are discussing today would not have happened,’’ he added.