Qtel raises $3bn to refinance Wataniya acquisition

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Qatar Telecommunications (Qtel) has raised a $3 billion loan to refinance debt taken for its acquisition in March of Kuwait's National Mobile Telecommunications (Wataniya).

Qtel increased the size of the loan from $2.5 billion on strong interest from more than 20 banks, the company said in a statement, confirming information a banker gave Reuters Loan Pricing Corp in London last week.

ABN AMRO Bank, Barclays Capital, BNP Paribas, DBS Bank, Qatar National Bank (QNB) and Royal Bank of Scotland (RBS) underwrote the loan, Qtel said, without giving details of pricing.

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They were joined by Al Khalij Commercial Bank, Calyon, Deutsche Bank Luxembourg, ING, Mashreq, Morgan Stanley, National Bank of Abu Dhabi (NBAD), Riyad Bank, Standard Chartered and Mizuho Corporate Bank as mandated lead arrangers.

The loan carries a margin of 65 basis points over the London interbank offered rate for the first 12 months and thereafter pricing is linked to a grid based on the company's leverage levels, the banker told Reuters Loan Pricing.

The cash will be used to refinance a $2.5 billion loan agreed by Qtel in March to help pay for the 51% stake in Wataniya. Qtel paid $3.72 billion for the stake.

The cost of financing this and other acquisitions weighed on Qtel's earnings in the second quarter, when net profit fell.

Wataniya's contribution to Qtel's profit in the quarter covered less than half of Qtel's debt financing costs, which surged to 278.66 million riyals from 2.43 million a year earlier, financial statements showed.