Industry Updates

'SAMENA Daily' - News

PTCL secures US$400 million loan from IFC for Telenor Pakistan acquisition

Pakistan Telecommunication Company Limited (PTCL) has secured debt financing of up to $400 million from the International Finance Corporation (IFC), a member of the World Bank, for the acquisition of Telenor Pakistan and Orion Towers (Private) Limited (TPL).

The telecom company shared the development in a notice to the Pakistan Stock Exchange (PSX).

“Further to our letter dated April 08, 2024, whereby it was notified that the Board of Directors of International Finance Corporation (IFC) has approved the debt financing up to $400 million to PTCL for acquisition of TPL, and that the finalization of workstreams to sign financing agreements with IFC is underway and expected to be completed on or before 31st July, 2024.

“It was also shared that the details of the debt financing shall be disclosed upon the finalization of financing agreements,” read the notice.

PTCL said that it has entered into seven years with one year grace period financing agreements with the IFC-led consortium, which includes Silk Road Fund (SRF) and British International Investment (BII) on 27th June, 2024 for the purposes of financing the acquisition of Telenor Pakistan and Orion Towers (Private) Limited.

“The loan up to $400 million is to be paid in quarterly instalments from second anniversary of the loan,” PTCL said.

The company added that the disbursement of financing thereunder shall occur following completion of conditions precedent specified in such financing agreements.

“We are thrilled to witness the materialization of this financing deal, which brings us closer to concluding this transformative milestone in Pakistan’s telecom sector,” President and Group CEO, PTCL & Ufone 4G, Hatem Bamatraf said.

“We are eager to serve a larger customer base with renewed commitment as soon as the acquisition process concludes following the necessary regulatory approvals.”

Last year, in a major consolidation of the telecom sector, PTCL entered into a Share Purchase Agreement (SPA) with the shareholders of Telenor Pakistan for the acquisition of 100% shares for Rs108 billion ($385 million) on a cash free, debt free basis.

Back then, PTCL informed that the acquisition would be financed by external debt.

“The transaction provides an opportunity for in-market consolidation in the telecom market which will predominantly lead to an improved long-term outlook of the telecom sector,” PTCL said in a statement then.

“The transaction will also improve the capabilities of the combined entities and result in improved coverage and quality of services to customers and enable wider access to communication solutions for businesses while supporting economic growth of Pakistan,” read the notice.

The telecom giant added that the transaction will further strengthen the position of PTCL Group as a leading operator in mobile, fixed, and micro-financing serving more than 70 million customers, upon completion of the transaction.

PTCL’s major assets include Ufone, a mobile operator in Pakistan with over 20 million customers. Etisalat, with a significant minority stake, runs it under an agreement with the government of Pakistan, which has the majority stake.

As per the company’s latest financial results, PTCL Group’s revenue increased by 25.8% YoY to Rs190.6 billion, mainly driven by strong performance in the consumer segment.



Source: https://www.brecorder.com/news/40310294/ptcl-secures-400mn-loan-from-ifc-for-telenor-pakistan-acquisition

ATTENTION