Zain KSA refinances $1.57 bn loan with additional working capital

Zain KSA announced that it has refinanced and extended the maturity of its syndicated $1.57 billion Murabaha loan facility for five years.
Zain leadership
The loan agreement includes a working capital of $172 million for two years, bringing more liquidity to Zain KSA to fund its business growth plans.

Zain KSA has gradually repaid $0.9 billion of the facility from its original 2009 borrowing of $2.5 billion, utilizing its internal cash resources.

“This refinanced Murabaha facility represents a critical stage in supporting the balance sheet restructuring roadmap of Zain KSA, following the recently announced capital reduction and subsequent increase through a rights issue in the second half of 2018,” Zain CEO Bader Nasser Al-Kharafi said.

The lenders for this facility are Al Rajhi Bank, Banque Saudi Fransi, Arab National Bank, National Bank of Kuwait, Credit Agricole CIB, Gulf Bank, Ahli Bank of Kuwait and Boubyan Bank.

Zain achievements in Saudi Arabia

Zain KSA was the only operator in the Kingdom to witness revenue growth of 5.5 percent during 2017.

Zain KSA’s turnaround efforts have resulted in a 40 percent improvement in the company’s EBITDA, reflecting the success of the management’s new business growth strategy and data monetization initiatives, as well as its parallel cost optimization and operational efficiency program.

Zain KSA recorded its first ever profit in 2017 as the operator recorded $265 million net profit against losses recorded a year earlier, with cash reserves accumulated as at 30 March 2018 exceeding SAR 1 billion.

Zain made investment of over SAR 5.1 billion investment in 4.5G advanced mobile network technology over the past three years, in addition to the June 2017 acquisition of 2×10 MHz of 1800MHz spectrum and 2×10 MHz of 800 MHZ spectrum in February 2018.

Zain KSA also holds 900MHz and 2100MHz frequencies. The company’s 2G, 3G and 4G network covers 97 percent of the Kingdom’s populated areas.

Image caption: (L-R) Naif bin Sultan bin Mohammed bin Saud Al-Kabeer, chairman of Zain KSA; Bader Nasser Al-Kharafi, vice chairman of Zain Group and Zain KSA, and Zain Group CEO and Abdulaziz Al-Deghaither, CEO elect of Zain KSA