Related News

Standard Bank has closed a US$2bn five-year debt facility for MTN Group, the multinational telecommunications firm, marking one of the largest telecoms deals to close in Africa. The funds will be used to finance the network infrastructure expansion of MTN Nigeria.


Originally the borrower was aiming to raise US$1.2bn, with the initial deal structure featuring a Naira equivalent US$840mn local currency facility, and a US$360mn foreign currency facility. However, following a positive syndication period, the overall debt was increased to US$2bnm and split into a Naira equivalent of US$1.6bn, and a US$400mn foreign currency facility.


The MTN Group expects the market size in Nigeria to increase to 52mn subscribers by 2011, and earlier this year MTN Nigeria was awarded a 3G licence and expects to roll out 3G to selected areas before the end of the year.


MTN Nigeria has also been in the process of rolling out an ultra-modern fibre optic transmission network, one of the largest of its kind in Africa. The company is already the largest mobile communications operator in Nigeria, with 14mn subscribers and a market share of over 44% as of June 2007.


Commenting on Standard Bank’s position in Nigeria, Tim Thackwray, head of investment banking for Africa at the bank says: “The fact that we have just finalised our merger with IBTC Chartered Bank and now become a significant player in the Nigerian market further strengthens our position.”


Standard has also worked closely with MTN, supporting its development in Nigeria. In 2001 it helped to arrange a US$450mn syndicated loan for the telecoms group which was used to partially fund the original licence payment made by the group when it entered the Nigerian market. The bank also arranged MTN Nigeria’s Naira bridging facility in 2002, and co-arranged a US$395mn loan in 2003. In 2004, Standard Bank raised a further US$200mn for company, and last year helped restructure some of MTN Nigeria’s financing arrangements.