Three firms bid to operate Onatracom

Three companies have expressed interest in managing the struggling national public transport agency, Onatracom, which government seeks to place under private managers.
Travellers watch as their luggage are loaded on to an Onatracom bus. The Ministry of Infrastructure is set to scrutinise proposals of Seven Solutions Ltd, KPMG International and SM....
Travellers watch as their luggage are loaded on to an Onatracom bus. The Ministry of Infrastructure is set to scrutinise proposals of Seven Solutions Ltd, KPMG International and SM....

Three companies have expressed interest in managing the struggling national public transport agency, Onatracom, which government seeks to place under private managers.

Seven Solutions (Seso) Ltd, a local company, and KPMG Ltd International and SMEC International have expressed interest in managing the public transporter, officials at the Ministry of Infrastructure (Mininfra) have revealed.

The Kigali-based seven Seso does consultancy in business planning, auditing, financial management, and tax advisory services.

While the two international companies have also established a presence in the country, with the SMEC International describing itself as “an Australian professional services firm with a global footprint that provides high-quality consultancy services for infrastructure projects.” 

KPMG is a global network of professional firms providing audit, advisory and tax services.

Mininfra will scrutinise proposals of the three bidders.

“Next step will be short-listing the most appropriate to be given the offer to present the detailed technical and financial offer,” said Eng. Peterson Mutabazi, the Minifra principal senior engineer for transport.

Revamping bus company

Through hiring a private manager, the government wants to turn the loss-making agency into a self-sustaining and profitable company within the next three years.

Then it would be opened up to private investors who would buy some of its shares and it would become a fully-fledged public limited company.

Onatracom has already changed “Rwanda Public Transport Company Ltd” as part of the agency’s restructuring plan that the government approved in June this year.

A call for expression of interest published last month said that the agency’s new manager will have to ensure that it gains modern infrastructure, provides cost-effective and quality services for both national and regional passengers, and ensure sustainable economic growth for the company.

Recent reports suggest that the agency, which used to operate more than 100 routes with a fleet of more than 100 buses, is currently serving 37 routes only, with a fleet of less than 40 buses.

The bulk of the vehicles are either grounded or damaged beyond repair.

Mininfra estimates that Onatracom loses Rwf500,000 and a 15 per cent depreciation of assets every month, leaving government with the only option of investing more funds into keeping Onatracom afloat.

Although the public transporter was established in the 1970s to provide and promote public transport in the country’s most isolated regions, officials at Mininfra say that the money made by the agency has been constantly mismanaged or embezzled.

The government was left with no option but to invest Rwf2 billion every five years to keep it afloat and help people in the country’s remotest areas.

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