Telefonica has signed a US$1bn export credit facility with a syndicate of banks.

Sweden’s SEK was the sole lender on the transaction, benefitting from 95% EKN cover. Société Générale acted as agent and mandated lead arranger (MLA) on the 10-year facility, while the Bank of Tokyo-Mitsubishi UFJ (BTMU), BNP Paribas and Santander acted as MLAs. The four MLAs provided counter-guarantees for the 5% residual risk not covered by EKN.

The loan will be used to finance deliveries of network equipment and commissioning services from Ericsson AB to Telefonica subsidiaries in various countries.

Xavier-Marie Robert, managing director, export finance at Société Générale CIB, tells GTR: “Société Générale was the lead bank that designed, structured and arranged the US$1bn financing to Telefonica. Once SocGen and the three other MLAs signed the loan agreement as original lenders, the loan was then transferred to the Swedish SEK as the sole lender with the benefit of the EKN guarantee. We have already closed this type of transaction using SEK as a lender of record in the past, and this is part of the strong and quite effective public support made available by the Swedish authorities.”