The East African (Nairobi)
August 11, 2003
Posted to the web August 13, 2003

Six Bid for Disputed Nile Hotel

Esther Nakkazi

Uganda is going ahead with plans to privatise the Nile Hotel International Ltd (NHIL) despite a court battle between the government and Tunisia's Tahar Fourati.

This is the second time the hotel is being concessioned by the Privatisation Unit. The hotel complex was in October 1994 partly sold to Tahar Fourati. A dispute ensued and Tahar Fourati lodged a case to have their money refunded.

The hotel was owned by the government of Uganda, 41 per cent holding and ACHL (59 per cent.) ACHL is a consortium comprising Tahar Fourati Group of Tunisia, Pan World Insurance of Uganda and Alan Kay of the US.

Grace Achile, the PU's public relations officer said the unit was contesting Tahar Fourati's claim in court but that it had repossessed the title to the land.

So far, six companies, including the Kenya-based Serena Hotels of the Aga Khan Fund for Economic Development (AKFED), have expressed an interest in managing the three-star Nile Hotel.

Michael Opagi, the director of PU, said: "This is the expression-of-interest stage. The technical committee will review compliance and by early August, we shall announce the qualifier for the second stage when the bids are opened.

An investor is expected to be in place by September. Other companies that expressed an interest in the hotel include South Africa-based Sun International, Legacy Group Holdings Ltd and East African Holdings Ltd based in Bermuda, which has a major stake in the Madhvani Group of Companies.

Others are Uganda's Mosa Court Apartments in a joint venture with the Southern Sun Group based of South Africa, and Tata Uganda Ltd in partnership with Taj Group of Hotels of India. "We are seeking an investor who will be able to upgrade Nile Hotel from a three-star to a five-star hotel," said Mr Opagi. The hotel has an international conference centre and is situated in central Kampala.

It stands on 17 acres of land and is wholly owned by the government of Uganda.

Prior negotiations and vetting of the bidders will be done to avoid repeating past mistakes.