Mobilink to issue Rs 3b 7-year bond on Wednesday (May 17)
KARACHI, May 30 2006: Mobilink, Pakistan’s leading private cellphone service provider in terms of market share, plans to issue a Rs three billion bond to expand and upgrade its network, an official associated with the transaction said on May 29. Mobilink, a unit of Egypt’s Orascom Telecom Holding, plans to issue the seven-year bond on Wednesday with a green shoe option of Rs 500 million, said Salman Jafri, chief fixed-income dealer at Jahangir Siddiqui Capital Markets, one of the three lead managers and advisers for the transaction.
MCB Bank and KASB Securities are the other co-advisers. Mr Jafri said Rs 800 million bonds will be offered via public offering and Rs 2.2 billion through a private placement. The proposed bond will carry a floating rate of 285 basis points above the six-month Karachi interbank offered rate with interest to be paid biannually, he said.
Recently, Bilal Shaikh, director of marketing at Mobilink, told Dow Jones Newswires that the company plans to invest $500 million in Pakistan in 2006. According to the Pakistan Telecommunication Authority, the country had 20 million cellular subscribers and 5.37 million fixed-line users at the end of 2005, up from 200,000 cellular subscribers and 3.4 million fixed-line users in December 2001.
Overall teledensity, or the percentage of people who own a phone, now stands at 20% in the country of 140 million. This is above India’s 12% but well below China’s near 50%, creating an opportunity for foreign telecom firms facing stagnant growth at home. According to official estimates, Pakistan’s telecom sector has received foreign investment of around $1 billion in the past two years, and another $5 billion investment is expected over the next five years. dow jones newswires.
Source: Daily Times