Qatar’s Qtel has asked its banks to finalise the terms of a US$2bn, three-year loan that it will use to refinance a forward-start facility at a much lower cost of borrowing to the company.
The former monopoly operator wants to reduce its cost of…
Qatar’s Qtel has asked its banks to finalise the terms of a US$2bn, three-year loan that it will use to refinance a forward-start facility at a much lower cost of borrowing to the company.
The former monopoly operator wants to reduce its cost of borrowing substantially below the 250bp over Libor that it pays for the forward-start loan – a type of financing that extends the term of the debt in return for a higher yield.
Qtel took out the forward-start facility in September 2009 when it wanted certainty that it could extend the duration of its debt. It used the facility to refinance a 2006 loan with a margin of just 22.5bp above Libor.
The telco, which originally took on debt to finance an acquisition spree, has asked five banks to refinance the facility: Bank of Tokyo Mitsubishi, Barclays Capital, BNP Paribas, DBS Bank, Qatar National Bank, and RBS.
The same five banks arranged the forward-start facility last September.
The operator first approached the banks about the refinancing in the middle of March.
Qtel declined to comment on the refinancing.
