Largest ever locally-arranged loan signifies investors’ faith in the fast-growing business
Celtel Tanzania Limited announces that it has secured US$ 70 million (Tsh 90 billion) in funding, the largest ever locally-arranged loan to be agreed in the country.
The loan will be used to drive the company’s expansion plans within Tanzania. In addition, it is anticipated that Celtel Tanzania will access an additional US$ 15 million in early 2007 through a roll-over facility to be provided by the lenders from the banking syndicate involved, allowing the company to further fund its desired development.
The loan will amortise over a 4.5 year period. Standard Bank Plc is the global arranger of the facility, while Stanbic Bank Tanzania Limited and CRDB Bank Limited in Tanzania acted as local arrangers.
The bank syndicate consists of eight banks: National Bank of Commerce (NBC), Exim Bank, Tanzania Investment Bank, CRDB, Standard Chartered Bank Tanzania Limited, Stanbic Bank Tanzania Limited, Development Bank of Southern Africa and FMO, the Dutch development financial institution. The latter two are major foreign financial development institutions that will, for the first time ever, provide funding in Tanzanian shillings.
Regarding the agreement, Celtel Tanzania Limited’s Managing Director Steve Torode commented: “This loan will help us achieve our goals of further network expansion and facilitate our ongoing efforts to provide a high quality service to the people in Tanzania.”
The syndicated 90 billion shillings Medium Term Loan agreement was signed in Dar-es-Salaam on Monday 12 June. Out of the US$ 70m, US$ 17.5m will be disbursed in United States dollars while the balance will be in Tanzanian shillings. The facility is to be repaid by 15 December 2010.
Commenting further, Torode said:
“We are delighted with the tremendous support which both local and foreign financial institutions have offered to Celtel and their encouragement in driving the business and our telecommunication services further here in Tanzania.”
Celtel Tanzania Limited was separated from Tanzania Telecommunications Company Limited (TTCL), the country’s fixed line operator, in August 2005, following the restructuring of both entities.
