According to a recently statement that was recently released in Dar es Salaam, Vodacom Tanzania has successfully obtained a loan from a group of local banks in the amount of USD 90 million in order to help finance capital expenditure.
The statement went on to explain that this money was part of a USD 150 million syndicated loan facility (SLF), with Citibank (Citi) Tanzania acting as the lead lender.
The USD 150 million SLF is scheduled to be spread out over a period of five years.
“The initial USD 90 million multi-currency financing has been completely sourced through local banks along with Citibank Tanzania,” read the statement, which was issued jointly by the mobile phone operator and Citibank.
The Citibank country officer for Tanzania, Omar Hafeez, went on to indicate that his bank’s involvement in the deal was also indicative of the bank’s overall contribution to infrastructure development in the country.
“We are proud to successfully deliver this comprehensive five-year financing solution to our customer in the midst of the global financial turmoil,” he said, “In doing so, we believe we have further contributed to the infrastructure development of our country.”
The statement further explained that Citi is planning to arrange for the remaining USD 60 million in funding to be supplied by various overseas sources.
In addition to the support Vodacom will receive from Citibank, other local banks are also expected to provide funding, including KCB (Tanzania) Ltd and National Microfinance Bank Plc, which will serve as senior lead arrangers; the National Bank of Commerce Ltd and Stanbic Bank Tanzania Ltd, acting as senior arrangers; CRDB Bank Plc and Standard Chartered Bank of Tanzania Ltd, serving as arrangers; and the Bank of Baroda (Tanzania) Ltd as a general participant.
According to Dietlof Mare, who spoke at the recent ceremony that was held in order to commemorate the deal, this funding was critical in order for the company to achieve its growth plans.
Mr. Mare went on to explain that those who would eventually receive the most benefit from this deal would be subscribers to the phone company, who will be rewarded with better services.
In addition, the chief executive officer of the Citibank Africa Division, Naveed Riaz, was also reported as having said that the fact that Vodacom Tanzania was being financed by his bank was should help to indicate the overall confidence in the growth model of the country.
“The fact that Citi has been able to arrange this financing for Vodacom Tanzania is a reflection of the market confidence in the high yield growth model of Vodacom Tanzania,” he said, “We are also proud of our partnership with other local lenders who put together the funding for the development of this industry.”
