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MTN Ivory Coast Defies Crunch, Raises $151 Mln Loan

19th March '09

Mobile group MTN's Ivory Coast subsidiary has defied the lean credit conditions by securing a five-year loan facility worth over $150 million from a syndicate of banks in the West African country, MTN and Citibank (C.N) said in a joint statement.

The 76.1 billion CFA francs ($151 million) loan would be used to restructure the company's debt and fund investments in the West African country, Africa's biggest mobile phone company MTN and Citibank, the lead bank, said. "The transaction has been completed in a period of such great tensions on local and international markets," said Martin Mugambi, Citibank's sub-Saharan Africa head of corporate finance. "In a climate of uncertainty, nine local banks have decided to take part, showing the breadth of the local banking market," he said.

Banks taking part in the syndicated loan included Bank of Africa CI BOAB.CI, BIAO CI, Omnifinance-Nigeria, SocGen's SGBCI SGBC.CI, Societe Ivoirienne de Banque (SIB), Groupe Credit Agricole (CAGR.PA), Standard Chartered CI (STAN.L), United Bank for Africa (UBA-CI) (UBA.LG) and regional banking group Ecobank ETIT.CI. Jamal Hussein, managing director of Citibank Cote d'Ivoire, said the deal "marks a decisive step in the developments of the local capital market in Ivory Coast and opens new possibilities to investors in the country and the region".

MTN, which operates in more than 20 countries in Africa and the Middle East, is trying to diversify its earnings beyond its key markets of Nigeria and South Africa. Last October MTN said it had bought Arobase Telecom, Ivory Coast's No.2 land line operator, and Internet service provider Afnet, which offers wireless broadband technology and data services in Ivory Coast, the world's top cocoa grower.

This week the MTN launched a money transfer system for customers without bank accounts in Africa and the Middle East, though a $9.7 million deal with South African mobile banking and payment specialist Fundamo. MTN shares fell 1.89 percent to 97.96 rand on Wednesday, underperforming the Johannesburg Top-40 index of blue-chip stocks .JTOPI which fell 0.73 percent. ($1=502.8 Cfa Franc)

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