Etihad Etisalat (Mobily) rescheduled a short-term, Murabaha-based Islamic finance facility it had obtained last year for the acquisition of Bayanat Al Oula.
The financing deal had been made public on 15 April 2008.
According to the terms of the agreement reached with SAMBA Financial Group, National Commercial Bank, Riyad Bank, and Saudi Arabian British Bank (SABB), the SAR 1.5 billion Islamic finance facility was re-financed with a medium-term loan amortizing over the coming four years.
The agreement mirrors the banking sector’s trust in the strength of Mobily’s position and projected performance.
Mobily had obtained the loan in early 2008 to buy up to 99% ownership of its data arm “Bayanat Al Oula”, bolstering its presence in the Saudi data services market with what was already a leading data service provider.
Before Mobily’s takeover, Bayanat owned one third of the national fiber optics network project, while Mobily onwed another third, thus boosting the latter’s share of the project to 66%. With this majority, Mobily solidified its competitiveness and leadership in data services and insured that it had the proper infrastructure, which the company is still enhancing today.
Khalid Al Kaf, Mobily’s CEO, said that the debt refinancing confirms the company’s solid financial position and the tremendous confidence it enjoys in the Saudi banking sector.
He added that the true value of the deal to buy Bayanat has already paid dividends for Mobily by bringing in more data subscribers, boosting Mobily’s revenues for the first half of 2009.
Al Kaf said that the company is working hard to boost growth and gain more market share through constantly launching new, high-quality services for individuals and businesses.
Mobily’s net profits for the first quarter were at SAR 675 million, which compare favorably to those of the first quarter of 2008 (SAR 448 million). Mobily’s net profits for the first half were at SAR 1.115 billion, a 49% increase over the same period of 2008, which stood at SAR 774 million in net profits.
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