Turkcell has secured a syndicated Islamic facility of $100 million from a consortium arranged by the Islamic Development Bank (IDB) and HSBC, with Dubai Islamic Bank acting as the Co-Arranger.
The Murabaha facility is to support the purchase of equipment required by Turkcell for its continuing program of upgrading and maintaining its GSM service. Murabaha is a contract of sale between the bank and its client for the sale of goods at a price plus an agreed profit margin for the bank. The contract involves the purchase of goods by the bank which then sells them to the client at an agreed mark-up. Repayment is usually in installments.
This medium-term facility, with a tenure of 24 months, was initially launched as a general syndication of $75 million. According to a press release, the market support for the transaction was very strong and over $110 million was committed by the banks. This response made it possible for the facility to be increased to a total of $100 million.
IDB and HSBC Bank will each contribute $20 million to the syndication through independent financing facilities, which are coordinated by an agreement providing one seamless facility. Dubai Islamic Bank will provide a $16 million participation into the facility.
Turkcell is the largest provider of GSM telephony services in Turkey, and as of June 30, 2003 had 17.2 million subscribers. It also has investments in mobile markets in Azerbaijan, Moldova, Georgia and Kazakhstan through Fintur Holding. With 1.6 million total subscribers, Fintur generated $126.8 million combined EBITDA in 2002. — (menareport.com)
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