Uganda Development Corporation (UDC) the Uganda government’s private sector investing arm, is to acquire an undisclosed number of shares in East Africa Medical Vitals (EAMVL), a medical glove-making company belonging to businessman, Ben Kavuya.
The two entities in July this year signed an investment partnership agreement for UDC to make an equity investment into EAMVL, said to be the first medical consumables manufacturing plant of latex surgical and examination gloves in Uganda and one of a few in Africa.
Dr. Patrick Birungi the UDC Executive Director signed on behalf of his company, while Ben Kavuya, the EAMVL Chairman, signed on behalf of his company.
When we reached Dr. Birungi for a comment on how much the government was investing and for what stake, he declined to say anything, saying he was bound by non-disclosure agreements, that UDC signed with EAMVL.
“But those are private documents. Do you want East Africa Medical Vitals to sue me? We signed a non-disclosure agreement,” he told this reporter on the phone, on Friday 27th October 2023.
When we further asked, if EAMVL having been in operation for merely two years and partly funded by debt, enough due diligence and business analysis had been done to ensure the viability of the venture, Dr. Birungi said he didn’t have enough information off-head and asked that we call him on Monday, 30th October 2023.
“I think I need to consult on how much information I can give out. I am not in the office now. I will be there on Monday, and then I will advise you,” he said.
When we called and messaged him today, he hadn’t responded not returned our calls by the time of publishing this story.
Uganda Development Corporation (UDC) is a body corporate established under the Uganda Development Corporation Act 2016. It is mandated to promote and facilitate the industrial and economic development of Uganda, through establishing subsidiaries and associated companies; entering into public-private partnerships with any commercial, industrial or agricultural undertakings as well as assisting in financing and management of undertakings that promote industrial or economic development. UDC’s mandate also includes promoting and facilitating research into industrial development. Other functions include- the takeover of old and new Government of Uganda investments in private sector companies.
95 million gloves annual production capacity
EAMVL was officially commissioned by President Yoweri Kaguta Museveni on the 12th of December 2021.
EAMV`s facility and manufacturing process, according to its website, have been certified by the National Drug Authority (NDA) for the manufacture of surgical instruments and appliances since July 2021. The company also says on its website that its manufacturing processes are ISO 13485: 2016 (Quality Management Systems for Medical Devices) and ISO 9001: 2015 (Quality Management System) certified.
During the launch, EAMV Managing Director, Brian Kavuya said the company had an installed capacity of 95 million gloves annually⏤ equivalent to 84% of Uganda’s consumption of medical gloves.
The Executive Chairman of EAMVL, Mr Ben Kavuya, in his remarks, shared about challenges that EAMV said USD12.7 million had been invested, USD6.3 million of which had been financed by the East African Development Bank (EADB). He also complained to the president about a delay by the Uganda Development Bank (UDB), in funding the project, which had led him to EADB at very high commercial rates of 8% per annum. This prompted State Investment Minister, Ms. Evelyn Anite, to rap UDB in front of the president for failing to live up to the task of saving local manufacturers, despite the government injecting UGX1 trillion into the development finance institution.
UDC in February this year signed a similar arrangement to acquire undisclosed shareholding in Igongo Country Hotel and Cultural Centre in Mbarara. The hotel was previously wholly owned by James Rwehabura Tumusiime, a Ugandan publisher and entrepreneur.
Some of the companies in which UDC owns shareholding, include Soroti Fruits Limited (80%), Horyal Investment Holding Company Ltd, the holding company for Atiak Sugar Factory (40%), Bukona Agro Processors Ltd (40.5%), Mutuma Commercial Agencies Ltd (36%), Kigezi Highland Tea Ltd Kayonza Growers Tea Ltd, Mpanga Growers Tea Ltd (31.9%) and Mabale Tea Growers Ltd (48.5%).
Others are: Moroto Integrated Cement/ Lime/ Marble plant, Lake Katwe Salt Project, Kalangala Infrastructure Services Ltd (45.7%) and Nile Hotel International Limited (100%).