Bridge loan for up to 12 months will help fund purchase of assets in Monaco and elsewhere
Bahrain Telecommunications (Batelco) is close to agreeing a US$650m loan that will allow it to buy Cable & Wireless Communications assets in Monaco and elsewhere.
Peter Kaliaropoulos, Batelco's CEO for strategic assignments, told Thomson Reuters LPC on Tuesday it was seeking a bridge loan for up to 12 months which will be replaced by a bond.
On Monday, Batelco agreed to by CWC assets in a two-stage deal worth up to US$1bn.
The loan with Citigroup and BNP Paribas will fund the first stage of the acquisition, which totals US$680m and will see state-controlled Batelco buy CWC's Monaco and Islands division.
The assets being acquired own stakes in telecom operators in 12 markets including the Channel Islands, the Maldives, and the Seychelles, providing fixed-line, mobile, broadband and television services.
Batelco will buy a 25 percent shareholding in Compagnie Monagesque de Communications (CMC), which holds CWC's 55 percent interest in Monaco Telecom. Monaco Telecom in turn holds a 36.8 percent stake in Roshan, a mobile phone operator in Afghanistan.
The second stage of the acquisition will allow Batelco to buy a controlling interest in CWC's remaining 75 percent stake in CMC for US$345m.
Kaliaropoulos said Batelco will decide how to finance the second stage of the acquisition within the next 12 months.
Acquisition-related syndicated loan volumes for borrowers in Gulf Cooperation Council (GCC) countries have plunged to an eight-year low in 2012, at US$354m, according to Thomson Reuters LPC data.
This marks less than half the US$850m raised in 2011 and a sharp drop from the US$24.4bn raised during the peak of 2007.