Sunday, Feb 12, 2012
RIYADH (Zawya Dow Jones)--Saudi Arabia's Etihad Etisalat Co. (7020.SA), better known as Mobily, has signed a 10 billion Saudi riyal ($2.6 billion) an Islamic refinancing agreement with seven local banks for three of Mobily's loans, the company said Sunday in a statement on the website of the Saudi stock exchange.
The loans being refinanced are covered 3.5 times, the company said. The loans are for the balance of an SAR10.781 billion long-term loan negotiated by the company in 2007, an SAR1.5 billion medium-term loan negotiated in 2009, and a SAR1.2 billion short-term loan negotiated in 2010, the telecoms company said.
The refinancing arrangement gives Mobily access to credit and other banking facilities of up to SAR10 billion payable in four tranches over five- to seven years, the company said.
Mobily, Saudi Arabia's second-largest telephone company by market capitalization, said it obtained the Murahaba refinancing for two of the tranches at the Saudi Interbank Offered Rate, or Saibor, plus 70 basis points, and at Saibor plus 65 basis points for the other two tranches.
In a Murabaha deal, a financier such as a bank buys a commodity and sells it to the customer at a higher price, in compliance with Islam's ban on interest.
In the statement, Mobily chairman Abdulaziz Al Saghyir said the refinancing "will allow Mobily to grow revenues and to maintain, as well as entrench, its leadership position in the Saudi broadband market."
Mobily, which is 27.4% owned by the U.A.E.'s Emirates Telecommunications Corp. (ETISALAT.AD), said the seven banks which were part of the agreement, were Samba Financial Group, Banque Saudi Fransi, National Commercial Bank, Riyad Bank, Saudi British Bank, Al Rajhi Bank and Saudi Hollandi Bank.
Share prices closed at SAR58.75 Saturday.
-By Ellen Knickmeyer, Dow Jones Newswires, +966 1 279 5252, ellen.knickmeyer@dowjones.com
Copyright (c) 2012 Dow Jones & Co.
(END) Dow Jones Newswires
12-02-12 0738GMT
