Zain Saudi Arabia Secures US$2.5 Billion Murabaha Financing

Zain Saudi Arabia says that it has closed a US$2.5 billion Murabaha financing facility. The funds will be used to repay its existing Murabaha, facilitating the mobile telecom operation's ongoing network expansion and future growth.

"This is an enormous vote of confidence by the International financial community in Zain KSA's performance to date and its future expansion plans in the region's largest economy," said Dr Saad Al Barrak, CEO of Zain Saudi Arabia and Zain Group. "The growth and success of this mobile operation is critical to Zain Group's 2011 ambition of being a top ten global mobile telecommunications company. The Murabaha facility, which comes at a vital stage of Zain KSA's business growth cycle, will play an important role in achieving this goal."

In less than 12 months, and despite the very competitive nature of the mobile telecom market in the Kingdom, Zain Saudi Arabia has acquired 4 million customers. For the first half of 2009, Zain KSA reported gross revenues of US$342 million with ARPU of US$19.

"Despite the challenging financial environment and a shortage of liquidity, the successful closing of this Murabaha is a testament to Zain's strong relationships with the banking community, the Group's financial health and overall confidence in the Kingdom of Saudi Arabia and beyond," said Mr Sam Deeb, Chief Financial Officer of Zain Group. "This is an excellent addition to Zain Group's enviable track record of successfully raising over US$ 25 billion over the last five years."

The term of the facility is two years with options of extending for a further twelve months. Al Rajhi Capital, Banque Saudi Fransi and Calyon acted as Financial Advisors, with a total of eight regional and international financial institutions participating in what is one of the largest Islamic financings this year.

Posted to the site on 11th August 2009