Etisalat lines up $8bln loan for Vivendi's Maroc stake bid

Qatar Telecom and South Korea's KT Corp also fighting over Maroc Telecom share
By Reuters
Sun 07 Apr 2013 04:59 PM

Abu Dhabi state-owned telecoms company Etisalat has lined up an $8 billion dual-tranche loan facility to finance its bid to acquire Vivendi's stake in Maroc Telecom, bankers working on the deal said.

French media group Vivendi aims to offload its 53 percent holding in the Moroccan firm to help reduce its debt. Two other potential suitors are also fighting over it - state-owned Qatar Telecom and South Korea's KT Corp.

The stake has a market value of around $6 billion, and the winning bidder is expected to eventually make an offer to buy out the minority shareholders, which would add to the purchase price.

Bidders are expected to arrange financing for the stake purchase ahead of making final offers to Vivendi, which are due at the end of April, the sources said.

Etisalat was not immediately available for comment.

The company, working with BNP Paribas as financial adviser, is putting together an $8 billion financing, split equally between a term loan and a bridge loan, which will be refinanced later through a bond sale, three bankers said, speaking on condition of anonymity.

Etisalat, the largest telecoms firm in the United Arab Emirates, is rated AA- by Standard & Poor's. Pricing on the loan is in line with the typical level for that rating, one of the bankers said.

Abu Dhabi state investment fund Mubadala, rated one notch higher, last week signed a $2 billion three-year facility, paying 45 basis points over the relevant benchmark.

The telecom company's bid for Maroc Telecom is its first public approach to a foreign company since a $12 billion bid for a controlling stake in Kuwait's Zain failed two years ago.

At that time it agreed on a debt package for the full bid with banks, also split equally between two $3 billion term loans and a $6 billion bridge-to-bond loan, but the seven months of work which bankers put into arranging the finance ultimately went unrewarded.

Separately, Qatar Telecom is also talking to banks about a loan facility to finance its bid for the stake.

KT Corp is being advised by Credit Suisse, Societe Generale and Citigroup Inc on the transaction.

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