Zain Saudi Arabia in talks to refinance $2.5bn loan

Kingdom's third largest telco said to be in discussions with lenders over Islamic loan

Zain Saudi Arabia, the country's third-largest mobile operator, is in talks with lenders to refinance its $2.5bn Islamic syndicated loan that matures in July, banking sources close to the deal said.

The firm has come under pressure to restructure its capital after losses pushed it close to a limit on capital losses imposed by the bourse.

The original Murabaha loan was secured in 2009 to back the company's network expansion, with two tranches consisting of $775m and SR6.46bn ($1.72bn).

The company, an affiliate of Kuwait's Zain, extended the maturity for the deal - which was three years and four months - by six months to July 27 in January.

Both tranches were priced at 425 basis points (bps) over LIBOR and included a bullet repayment. Bookrunners were Al Rajhi Banking and Investment Corp and Credit Agricole CIB.

Zain Saudi was not available to comment.

The telecoms operator posted an 11 percent decline in losses in January, bringing the firm's accumulated losses to about SR9.6bn, around two-thirds of the company's SR14bn of share capital.

The results followed Kingdom Holding and Bahrain Batelco's failed $950m offer for a 25 percent stake in Zain Saudi after disagreements brought negotiations to a standstill in September last year.

Related:
Join the Discussion

Disclaimer:The view expressed here by our readers are not necessarily shared by Arabian Business, its employees, sponsors or its advertisers.

NOTE: Comments posted on arabianbusiness.com may be printed in the magazine Arabian Business

Please post responsibly. Commenter Rules

  • No comments yet, be the first!

All comments are subject to approval before appearing

Further reading

Features & Analysis
Trading bricks: The growing popularity of real estate investment trusts in the Gulf

Trading bricks: The growing popularity of real estate investment trusts in the Gulf

Investor interest in real estate investment trusts (REITs) has...

First bank merger in 20 years sets Saudi Arabia up for more deals

First bank merger in 20 years sets Saudi Arabia up for more deals

Q&A look at what the planned merger of HSBC and RBS’s Saudi ventures...

A natural move: How Dubai Chamber is strengthening its ties in Latin America

A natural move: How Dubai Chamber is strengthening its ties in Latin America

With vast resources and more than half-a-billion people, the...

Most Discussed
sponsoredTracking