Incumbent Turk Telecom has signed a bank guarantee agreement with four banks, meaning it will be able to take out a E150m loan previously secured with the EIB.
The original loan agreement was signed with the European Investment Bank on 12 May.
Turk…
Incumbent Turk Telecom has signed a bank guarantee agreement with four banks, meaning it will be able to take out a E150m loan previously secured with the EIB.
The original loan agreement was signed with the European Investment Bank on 12 May.
Turk Telecom today said it had signed a bank guarantee with Bank of Tokyo-Mitsubishi, ING Bank, Societe Generale and Sumitomo Mitsui Banking Corporation.
The E150m loan comes with a two-year grace period and eight years’ maturity.
A Turk Telecom spokesman told TelecomFinance that this loan was the second tranche of a larger E250m loan agreement. Tranche A, which involved a E100m loan, was fully utilised in 2010 and did not require a loan guarantee agreement.
The E150m loan is tranche B, and requires a bank guarantee because the EIB wanted to provide a guarantee for tranche A (E100m) on this project, but wanted to transfer its risk for E150m to commercial banks.
The spokesman added that the EIB financing for a hypothetical future Turk Telecom financing would be likely to involve this dual-tranche structure: one tranche with a guarantee agreement and another tranche without it.
The E250m will help finance Turk Telecom’s E500m project to increase broadband capacity in Turkey by two million lines, thereby extending coverage and improving the speed of existing lines.
Turk Telecom would not reveal any further details on the terms of the loan.
