Telecom Egypt secures US$500m loan to support its capital expenditure

EGYPT – Telecom Egypt has announced obtaining a new US$500 million medium-term syndicated loan to be used to support its capital expenditure and refinance existing short-term facilities.

According to Telecom Egypt, First Abu Dhabi Bank PJSC and Mashreq Bank PSC were mandated as Joint Coordinators, Underwriters, Bookrunners, and Initial Mandated Lead Arrangers of the facility, similar to the medium-term syndicated loan obtained in October 2018.

It added that FAB is also the Facility Agent for the transaction and Mashreq the designated Account Bank and the Documentation Agent.

“I am very proud that our strong operational and financial performance exhibited during the last three years has boosted the confidence of respected international financial institutions in Telecom Egypt, enabling us to, once again, secure a US$500 million syndicated loan with the loan being 2.7x oversubscribed. The aim of the facility is to convert our short-term USD overdrafts into longer-term loans to enable the company to repay installments in line with its cash flow generation. The restructuring of our leverage comes in line with our financing strategy, to deleverage over time while enhancing our financing cost” Managing Director and Chief Executive Officer of Telecom Egypt, Adel Hamed, said.

Hamed added that the aim of the facility is to convert our short-term USD overdrafts into longer-term loans to enable the company to repay installments in line with its cash flow generation.

The restructuring of the company’s leverage comes in line with our financing strategy, to deleverage over time while enhancing the company’s financing cost.

“We are confident that this facility, along with our growing organic performance and certainty on dividends from associates will translate into a greater cash flow flexibility for the company,” he noted.

The Egyptian government owns 80 percent of Telecom Egypt, and it is the oldest telecom company in the region.

It was established about 160 years ago, and it provides all terrestrial voice communications services, Internet services and mobile services.

Telecom Egypt operates within the telecommunication services sector, focusing on integrated telecommunication services and has subsidiaries operating across British Islands, Western Europe, Northern Africa and the Middle East.

In August 2021, the telco posted a net profit of 3.9 billion Egyptian pounds (US$249.20 million) for the first half of 2021, up 88% from the same period in 2020.

Total consolidated revenue was 17.4 billion Egyptian pounds in the period, up 16% year-on-year, it added.

Liked this article? Subscribe to DealStreet Africa News, our regular email newsletter with the latest news, deals, and insights from Africa’s business, economy, and more. SUBSCRIBE HERE

 

 

 

 

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.