Saudi Telecom Company (STC), said its Indonesian unit Axis has secured $1.2 billion in financing to help fund its expansion and growth strategies for the next five years.
The finance deal, with a tenor of seven and a half years, involves several local and international financial institutions and all facilities have been structured in a sharia-compliant manner, said a STC statement. (full story - trade arabia)
It comprises three facilities - a $450 million Murabaha facility, arranged by Deutsche Bank and HSBC and underwritten by DB and Saudi British Bank; a $400 million facility for equipment purchases from Huawei, underwritten by China Development Bank; and a $350 million facility for equipment purchases from Ericsson, arranged by HSBC and backed by EKN, the Swedish Export Credit Agency.
The financing will help fund Axis expansion and growth strategies for the next five years, especially expansion into mobile broadband and improved coverage nationwide, which in turn will result in higher financial returns for the group, the statement added.
Announcing the deal, Ameen Al Shiddi, chief financial officer, said it was one of the largest Islamic financing deals in Asia and one of the largest international financing deals in East Asia.
'The deal will help fund Axis’ expansion and growth strategies for the next five years, which in turn will result in higher financial returns for the group,” he added.
According to him, the Indonesian telecom sector has witnessed sound growth over the past few years owing to the rising mobile and internet penetration rates, which have had a positive impact on Axis, with the company passing 11 million subscribers and with service available in more than 400 cities across Indonesia.
Al Shiddi said the size of the financing deal demonstrates the confidence that the financial markets have in the ability of Axis to achieve its business goals.
Source : http://www.tradearabia.com/news/IT_199169.html - May 24, 2011
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