The MLA group is made up of Abu Dhabi Islamic Bank, Bank al-Jazira, Al-Rajhi Banking & Investment Corporation, Citigroup, Dubai Islamic Bank, National Commercial Bankand Samba Financial Group. Documentation is currently being finalised.

The initial finance will come in the form of a one-year bridge loan, due to Etisalat’s urgent need for funding to begin setting up the network. The bridge is subsequently expected to be converted into a project finance facility, likely to have a tenor of 10 years.

The loan will consist of two tranches. The first $1,600 million will be used as partial payment for the AED 12,200 million ($3,457 million) licence, for which the state-owned operator was the highest bidder in July. The second $750 million will be used for the purchase of equipment. Technical bids are due by the end of August from prospective suppliers.

‘Pricing is still being worked out but it is likely to be very competitive, especially on the $1,600 million tranche because the facility is directly guaranteed by the shareholders in the Ittihad Etisalat consortium,’ says a banker involved in the deal.

Etisalat owns 30 per cent of Ittihad, the General Organisation of Social Insurance holds 15 per cent and the remainder is held by Saudi firms Al-Jomaih Holding, Abdul-Aziz al-Saghyir Commercial Investment, Rana Investment, Abdullah & Said Bin Zagr and Riyadh Cables Group. BNP Paribasis acting as financial adviser.

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