Mobily signs agreement for vendor financing
Deal aimed at funding network upgrade from Alcatel-Lucent
Saudi Arabian telecoms operator Mobily has signed a long-term vendor financing agreement with Export Development Canada (EDC), for a loan worth SAR750m ($200m), with no corporate guarantee.
The duo announced the deal on the website of the Saudi Stock Exchange (Tadawul’s).
Mobily will use the Sharia-compliant financing to purchase telecoms equipment from France’s Alcatel-Lucent, for a planned network upgrade.
The loan has a life of 10 years, six months and its utilisation period is two years; mandated lead arrangers are Credit Agricole, Societe Generale and the Bank of Tokyo Mitsubishi. Mobily will repay the debt in 17 equal semi-annual instalments, at a fixed rate of 2.52% per annum, alongside a 3% upfront premium.
In May 2014, Mobily and Alcatel-Lucent unveiled plans to roll out a virtualised radio access network (RAN). Under the contract, Alcatel-Lucent will install its 9771 Wireless Cloud Element Radio Network Controller (WCE RNC) to enhance Mobily’s service performance, reliability, scale and operational efficiency.