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Etisalat sees finance agreement on Zain by end-Feb
Repeats due diligence on track for completion by end-Feb.
February 24, 2011 12:18 by Reuters
UAE telecoms firm Etisalat , bidding for a 46-percent stake in Kuwait’s Zain , sees a bank deal to finance the $12 billion offer done by the end of February, it said on Thursday.
Etisalat, the Gulf’s largest telecoms firm, saw its bid for Zain face a setback this week after Zain’s board rejected all bids for its Saudi affiliate, a key condition of the deal.
The Abu Dhabi-based operator, which says it will meet a February deadline to complete due diligence on Zain, said it would agree final terms with lenders for the three-part financing it wants by the end of this month.
Etisalat plans to raise $6 billion through an 18-month bridge loan, which it said will be repaid with a bond issue.
The company will raise a further $3 billion through a three-year loan and a five-year $3 billion loan. The five year loan will also be repaid through bond sales.
In January, Etisalat, 60 percent owned by the UAE government, said it was “highly confident” of securing financing for the Zain deal and talks with 18 international and regional banks were continuing.
Etisalat established an $8 billion bond programme in November made up of a $7 billion conventional component and a $1 billion Islamic bond, or sukuk, component, but has so far not announced any potential sales.
(Reporting by Jason Benham and Enjy Kiwan; Writing by Rachna Uppal; Editing by Amran Abocar)