Mobily to appoint refinancing adviser soon

15 March 2011

Saudi telecoms firm could raise about $2.5bn later this year

Saudi Arabia’s Etihad-Etisalat (Mobily) is expected to appoint the local Samba as financial adviser for its refinancing plan set for later this year, according to sources in the kingdom.

Sources close to the company say Samba is the favourite for the mandate, and a deal could be signed before the end of the month to formally engage the bank as financial adviser on the refinancing.

Once appointed, the financial adviser will start work on a refinancing plan that could see Mobily raise up to SR10bn ($2.7bn) to repay existing debt and fund its expansion. According to the request for proposals sent out to potential financial advisers at the beginning of the year, Mobily wants to complete the refinancing by 30 June.

The deal could see Mobily raise funds through both Islamic loans and a sukuk (Islamic bond) issue. The mandate will also include advising on the development of a new capital structure for the firm to fit its spending requirements.

Mobily raised $320m from a group of local banks in December 2010 (MEED 24:12:10). That deal was priced at just 65 basis points above the Saudi interbank offered rate, and was seen as an opportunity for relationship banks to position themselves for the upcoming financial adviser role.

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