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| Wednesday, 10 March 2004 |
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$ 86 million facility - largest debt raising by a corporate: Standard Chartered Bank arranges landmark deal for Mobitel Standard Chartered Bank, as the mandated lead arranger, led eight other participating banks in completing arrangements for a seven year loan facility of USD 86 million for Mobitel (Pvt) Limited. The other banks in the syndicate, in addition to Standard Chartered Bank are Bank of Ceylon, DFCC Bank, Hatton National Bank, National Development Bank, National Savings Bank, People's Bank, Sampath Bank and Seylan Bank. The transaction is the single largest debt raising by a Sri Lankan Corporate to date. A unique feature of the deal is the partial support by the Swedish Export Credit Agency, EKN, making it the largest Export Credit Agency backed transaction in Sri Lanka without Government support. Standard Chartered Bank Sri Lanka Chief Executive, Vishnu Mohan, praised the Bank's syndication partners and added that, "with over 150 years of experience in global finance and corporate lending, Standard Chartered Bank has both the network and the knowledge to bring fresh and innovative solutions for our customers." "The support of EKN for this facility - the largest transaction without Government support to be backed by an Export Credit Agency - is a great validation of the strength of Mobitel's business plans, and we are proud to have been able to align our financial know-how to benefit Sri Lanka's industries," Vishnu Mohan said. The Facility is available in US Dollars and Sri Lankan Rupees. This transaction is also notable for having an element of the finance supported by EKN in Sri Lankan Rupees. The overall tenor of the Facility is seven years. The facility was extremely well received in the market and closed comfortably oversubscribed. The facility mainly finances the supply of equipment from Ericsson, but other contracts are also included. Mobitel, which is 100% owned by Sri Lanka Telecom Limited, has commenced the conversion of its existing network to a GSM platform to grow its subscriber base in line with its mission to be the largest mobile telecommunications operator in Sri Lanka by 2010. The company recently launched its state-of-the-art GSM network with EDGE technology in keeping with its vision to be the leading provider of wireless connectivity and content in Sri Lanka. Mobitel is the first in the world to launch the Enhanced data rates for GSM Evolution technology (EDGE) - the latest technology enhancement available for deployment in GSM. In April 2003, Mobitel (Pvt) Limited, through its financial advisors, DFCC Bank, called upon interested banks to submit proposals to Lead Arrange a USD 86 million financing facility to convert its TDMA network to a GSM platform. In May 2003, the Mandate to Lead Arrange the transaction was awarded to Standard Chartered Bank. The primary equipment supplier for the conversion project is Ericsson AB of Sweden. Standard Chartered Bank, together with its syndicate partner banks, have completed the necessary documentation and agreements through local and international legal counsel, where all agreements pertaining to the transaction were attested by all relevant parties on December 19, 2003. Mobitel CEO, Lalith de Silva said that the banks in Sri Lanka and overseas funding agencies placed their confidence in Mobitel and has funded US$ 88 million. "Over a three-year period our investments will exceed US$ 200 million," he said. The company has entered into over 100 partnership agreements which includes significant partnerships such as with Ericsson to build the world class GSM infrastructure and the several IT infrastructure and application partners such as IBM, Sun Microsystems, HP and Convergy's. "Our ambition is to achieve a 100% coverage within a short space of time. This means reaching parts of the island that our predecessors have not reached. Today we deploy a network, which would provide 40% coverage, from which we will move swiftly until we reach our goal of 100%," de Silva said. |
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