MTC/Celtel Sign $320m Financing Deal for expansion
Officials of MTC / Celtel and the International Finance Corporation (IFC) - the private sector arm of the World Bank Group, have signed a $320 million deal, the first largest ever financing deal in Sub-Saharan Africa. The $320 million package to five operations of Celtel International B.V. an MTC subsidiary is to help expand and upgrade its fast growing mobile networks in the Democratic Republic of Congo, Madagascar, Malawi, Sierra Leone and Uganda. The investment according to the statement will result in better quality mobile access in countries with extremely limited telephone services, thus creating new opportunities for businesses and consumers across the economic spectrum.
The MTC Group is a pioneer in mobile telecommunications in the Middle East and on the African continent. The company was incorporated in 1983 in Kuwait as the region's first mobile operator and since the initiation of its "3x3x3" profitable expansion strategy in 2003, it has grown very rapidly .MTC is a leading mobile operator, now in 6 Middle Eastern (soon 7 with KSA) and 14 sub-Saharan African countries with over 13,000 employees, providing a comprehensive range of mobile voice and data services to over 32.145 million active individual and business customers (as of June 30, 2007).The company already operates in Kuwait and Bahrain as mtc-vodafone, in Jordan as Fastlink, in Iraq as mtc atheer, in Lebanon as mtc touch, in Sudan as Mobitel and in 14 sub-Saharan countries in Africa as Celtel: Burkina Faso, Chad, Democratic Republic of the Congo, Republic of the Congo, Gabon, Kenya, Malawi, Madagascar, Niger, Nigeria, Sierra Leone, Tanzania, Uganda and Zambia.
Initially announced at the World Economic Forum in South Africa on June 13, 2007 by Celtel Chairman Dr Mo Ibrahim, the IFC will provide a $160 million loan for its own account; it's largest to date in Sub-Saharan Africa. That loan is complemented by another $160 million in syndicated loans with participating commercial banks and parallel loans from bilateral financial institutions. The transaction also marks the first ever mobilization of IFC syndicated loans in Madagascar, Malawi and Sierra Leone, helping to bring long-term (7 year) commercial financing to markets at the frontier of private sector development. The syndication includes three South African banks that are participating in IFC's B-loan program for the first time.
Celtel, which was acquired by MTC of Kuwait in April 2005 according to the statement will use the funds to modernize and develop the mobile networks in countries with obsolete and inadequate fixed-line networks and very low telephone penetration rates, ranging from just over four phones for every 100 people in Malawi and Madagascar to about 10 per 100 people in Sierra Leone. Since the MTC's acquisition of Celtel it has invested $10 billion in African mobile telecom services.
(Source: This Day)