Mobile broadband operator, Smile Telecoms Holdings limited, has disclosed that it has raised $365 million debt and equity financing to accelerate its 4G LTE network expansion in Africa.
The funding, the company said would be used to expand its existing 4G LTE mobile broadband networks and services, such that by the end of 2015, Smile will offer clear voice services and have national coverage comparable to the largest 3G network in each of its current countries of operation.
Similarly, the broadband operator also disclosed that it would launch its broadband network in Democratic Republic of Congo (“DRC”) early in 2016.
The funding, according to the mobile broadband operator is comprised of $50 million of equity, raised from the Public Investment Corporation on behalf of Government Employees Pension Fund (“PIC”), and a USD315 million multi-tranche, multi-jurisdictional debt facility led by African Export-Import Bank with participation from the Development Bank of Southern Africa, Diamond Bank PLC, Ecobank Nigeria, the PIC, the Industrial Development Corporation of South Africa Limited and Standard Chartered Bank.
Under the terms, the funding, the company said would be used to accelerate national network roll-out, including equipment and services provided by Alcatel Lucent and Ericsson, a full MPLS (Multiprotocol Label Switching) network, a London Point of Presence and expanded international backhaul services, and to fund operational expenditure and working capital.
Accordingly, the funding is one of the largest capital raises ever for a telecommunications operator in Africa and brings the total funding committed to Smile since its founding in 2007 to approximately USD600 million.
Meanwhile, according to the Broadband Strategies Handbook by The World Bank, “a 10 per cent increase in the penetration rate of broadband in developing countries is associated with a 1.4 percent increase in GDP per capita.”
Speaking on the new development, Irene Charnley, Chief Executive Officer of Smile, said, “Now that we are fully funded to deliver national coverage of unrivalled super-fast internet access and clear voice services, our priority is to ensure that our customers experience and benefit from the power of high speed mobile broadband compared to the narrowband services available to date, including how to effectively manage the superior experience in terms of data consumption.”
Also speaking, Sheikh Mohammed Sharbatly, Deputy Chairman of Smile, said, “I have recently had the joy of using the Smile network in Nigeria, and the quality is better than what we experience in the United Kingdom and in Saudi Arabia. By licensing 800MHz spectrum for commercial use at an early stage relative to many other countries, including high-income ones, the governments of Nigeria, Tanzania, Uganda and the DRC have each demonstrated commitment to be at the forefront of the broadband revolution and to accelerate development and GDP growth, and we commend them””
For Dr. Ernest Azudialu, Chairman of Smile Nigeria, the availability of a reliable high-speed, broadband internet service in the country would further help businesses and individuals become more productive and efficient, and this in itself is an economic enabler.
“I am pleased to be part of a company that has the potential to improve the lives of the people in Nigeria, and the other African countries that we operate in, as well as create employment opportunities.
“Founded in 2007 and incorporated in Mauritius, Smile is a pan-African telecommunications group with operations in Nigeria (Smile Communications Nigeria), Tanzania (Smile Communications Tanzania), Uganda (Smile Communications Uganda) and the Democratic Republic of Congo (Smile Communications DRC) and has an associate company in South Africa. Smile has a single transformative objective of using the best and most innovative technologies to provide its customers with fast, reliable, high quality, easy to use and affordable communication services”
Before now, Smile owns and operates mobile wireless 4G LTE broadband networks in the 800MHz band in Nigeria, Tanzania and Uganda.
Source: http://www.vanguardngr.com/2015/09/smile-closes-365m-financing-to-expand-4g-lte-network/