Global Telecom Holding (GTH) subsidiary Banglalink has priced US$300m’s worth of 5-year 8.625% notes.
The issuance marks the first time a Bangladeshi company has offered an international bond.
The mobile operator plans to use the proceeds from the…
Global Telecom Holding (GTH) subsidiary Banglalink has priced US$300m’s worth of 5-year 8.625% notes.
The issuance marks the first time a Bangladeshi company has offered an international bond.
The mobile operator plans to use the proceeds from the offering, being run by Citigroup, to repay existing debt and to fund capital expenditure.
The paper will have a re-offer price of 99.008% and a yield to maturity of 8.875%.
Banglalink expects the notes to be rated B1 and B+ by Moody’s and S&P – in line with its corporate rating. Bangalink is a wholly-owned subsidiary of GTH, which in turn is majority-owned by Amsterdam-based VimpelCom.
In a ratings report Moody’s previously wrote that the issue would help Banglalink to ease pressure on liquidity, although cautioned that the issue and operating cash flow are not likely to be enough to cover debt maturing over the next 12 months, which amount to US$411.7m, and capex expected to exceed US$257.3m.
“Banglalink is likely to depend on funding from its parents or from local banks to meet its financing gap,” Moody’s said.
“While Banglalink’s fundamental credit is weakly positioned for the B1 level, the continued operating and financial support from GTH, as well as its ultimate parent, VimpelCom (Ba3 stable), provides some comfort.”
Banglalink is Bangladesh’s second largest mobile operator with 28.9 million subscribers, according to data from regulator BRTC. Last year the operator won a 3G licence to offer services in the 2.1 GHz band.
