Saudi Arabian telecom firm Etihad Etisalat (Mobily) had signed a SR10 billion ($2.7 billion) Islamic financing agreement with seven local banks to refinance three of its existing long, medium and short term loans, the company said Sunday. The loans being refinanced, which are covered 3.5 times, are the remainders of a SR10.781 billion long term loan arranged by the company in 2007, a SR 1.5 billion medium term loan arranged in 2009 and a SR1.2 billion short term loan arranged in 2010. The financing arrangement, which has been concluded on better terms and conditions compared to the previous loans, gives Mobily access to banking facilities, including a revolving standby credit facility, up to SR10 billion payable in four tranches over five to seven years. This is a clear indication of Mobily's financial strength and its strong cash flow. The company has decided to take this step now rather than in the future, as Mobily was able to negotiate the refinancing at a competitive rate of SIBOR (Saudi Interbank Offered Rate) + 0.70 percent until the end of the loan repayment period of two of the tranches and SIBOR + 0.65 percent until the end of the loan repayment period of the other two tranches. Mobily Chairman Eng. Abdulaziz Alsaghyir said the refinancing will allow Mobily to grow revenues and to maintain, as well as entrench, its leadership position in the Saudi broadband market. It will also allow Mobily to provide its users with the best possible data services, applications and an advanced high-speed infrastructure based on the best technologies. The seven local banks are: Samba Financial Group, Banque Saudi Fransi, National Commercial Bank, Riyad Bank, Saudi British Bank (SABB), Al Rajhi Bank and Saudi Hollandi Bank. Samba Capital has been appointed as financial advisor and Samba has been appointed as Airtime Agent Bank. Banque Saudi Fransi has been appointed as Documentation Bank and Agent Bank for the revolving standby credit facility.
