Airtel signs $500m credit facility to partially refinance €750 million Euro-denominated bond

• Signs $880m loan deal with participation from JP Morgan, Standard Chartered, HSBC, others

Charles Abuede

Following the recent announcements by Nigeria’s telecoms giant in relation to the sales of its towers and minority investments in its mobile money services, Airtel Africa Plc, a leading provider of telecommunications services with presence across 14 African countries has announced the successful signing of a new $500 million loan facility with a group of relationship banks such as Bank of America, BNP Paribas, Citibank, HSBC, J.P. Morgan, Standard Chartered Bank and two Indian relationship banks, Axis Bank and Kotak Mahindra Bank.

The telecom giant in a disclosure on Wednesday signed by Simeon O’Hara, the group company secretary, and filed to the Nigeria Exchange Group (NGX) stated that the loan will be used to partially refinance the Group’s €750 million Euro denominated bond (which is equivalent to $880 million) due 20 May 2021 while the balance of the Euro denominated bond will be repaid with existing Group cash to reduce gross debt and associated interest costs. Airtel further revealed that the new committed facility consists of a combination of a revolving credit facility and term loans with tenor of up to 4 years.

According to Airtel Africa, the banks that participated in the facility include a diverse group of existing global relationship banks, which will ensure the achievement that the new loan facility further strengthens the core liquidity of the Group.

However, the credit facility, according to the disclosure, has prepayment flexibilities that will allow the Group to optimise the efficiency of its capital structure with the free cash flows and cash receipts anticipated over the next 12 months following the recent announcements related to tower sales and mobile money minority investments.