Saudi Arabia’s Mobily has signed a US$200mn vendor financing agreement with Canada’s export credit agency, Export Development Canada (EDC).

The facility, with no corporate guarantee, is to be used to buy telecommunications equipment from Alcatel Lucent, to upgrade and enhance its network.

The appointed banks are Crédit Agricole, Société Générale and Bank of Tokyo Mitsubishi, who are mandated lead arrangers on the shariah-compliant facility, which has a 10.5-year tenor and will be utilised over two years.

Mobily, which competes with Saudi Telecom Co (STC) and Zain Saudi, will repay the loan in 17 semi-annual equal instalments.

The loan has been priced at a fixed rate of 2.52% per year with a 3% upfront premium.

Mobily had a 39% share of Saudi’s mobile subscribers as of March 31, according to Kuwait’s Zain, the parent firm of Zain Saudi. STC is market leader with 44%, while Zain Saudi claims the remaining 17%.