Etisalat International, the investment arm of Emirates Telecommunications Corporation (Etisalat), yesterday appointed a group of seven banks as mandated lead arranger of a Dh7.75 billion ($2.11 billion) loan to finance 90 per cent of its expense to acquire a 26 per cent stake ('B' shares) in Pakistan Telecommunications Company.
HSBC Amanah, HSBC's Islamic finance division, was retained by Etisalat in late June to formulate the finance plan for the acquisition, to structure the facility and to advise on the Islamic debt-raising exercise.
Six of the seven mandated lead arrangers, selected by Etisalat after competitive bidding managed by HSBC Amanah, are: Barclays Capital, Calyon, Citigroup, Deutsche Bank, National Bank of Abu Dhabi, and National Bank of Dubai. HSBC Amanah joined this group once the terms and pricing were finalised, exercising its option to join the winning banks on equal terms.
The arrangers have fully underwritten the deal and are committed to funding the transaction.
A consortium of Etisalat and Dubai Islamic Bank was appointed in June as the successful bidder for the stake being sold by the government of Pakistan, and the 18-month bridge facility will be used to finance Etisalat's share of the final payment due this month.
In addressing Etisalat's financing requirements, an Islamic bridge facility has been structured by HSBC Amanah as a "share mura-baha" using the underlying shares of PTCL for the trade transactions to complete the financing.
This financing represents the largest ever share murabaha in the Islamic finance market.
Obaid Bin Mes'har, chief executive of Etisalat International, said, "We are very pleased to announce this landmark finance deal. Their enthusiastic participation demonstrates their keen interest in Etisalat as well as the value of the PTCL acquisition."
In June the consortium led by Etisalat outbid China Mobile and Singtel for all the B shares in PTCL which constitute 26 per cent of the equity and 58 per cent of the voting rights for board nominations. The nearly $2.6 billion bid procures management rights for PTCL, Ufone, the mobile operator, and Paknet, the ISP. Etisalat also won the second GSM license in Saudi Arabia last year.
Gulf News
