Egypt's Mobinil to issue $273 mln in bonds

 @ibtimes on December 30 2009 11:25 AM

 CAIRO, Dec 30 - Egyptian mobile telephone operator Mobinil (EMOB.CA) will issue 1.5 billion Egyptian pounds ($273.3 million) in 5-year bonds starting mid-January, the bond's underwriter EFG-Hermes (HRHO.CA) said.

The bonds, which Mobinil will use to finance the expansion of its network, will have a fixed annual yield of 12.25 percent payable once every six months, said Karim Awad, head of EFG-Hermes investment banking.

They will be marketed mainly to non-bank financial institutions inside and outside Egypt.

It is probably the first in Egypt's history to be distributed outside the banking sector, Awad told Reuters by telephone.

The regulator, the Egyptian Financial Services Authority, has approved the issue, which will be officially announced on Thursday, Awad added. Under Egyptian rules, the issue must begin 15 days after the announcement.

The issue will probably close by the end of January, Awad said.

The central bank has blocked Mobinil, which holds the largest share of Egypt's mobile market with almost 25 million subscribers, from accessing bank lending as it considers it part of one of its major shareholders, Orascom Telecom (ORTE.CA).

Under Egyptian banking laws, banks are allowed to lend only a certain portion of their total loans to any one client. (Writing by Patrick Werr; Editing by Hans Peters and David Cowell)

Join the Discussion