Cairo,: Orascom Telecom Holding S.A.E. (“OTH” or “Orascom Telecom”) today announced that it has successfully priced and placed US$750 million of Senior Notes due 2014 (the “Notes”). The transaction was increased from US$500 million due to favorable pricing and very strong investor demand. The offering is a milestone for Orascom Telecom, for Egyptian corporate issuers and for emerging markets in Europe, the Middle East, Africa and Asia.
The placement of the Notes is one of the most successful debt capital markets transactions of its kind and sets a benchmark in the market in several respects:
– First international corporate bond issuance by an Egyptian corporate since 1999
– Largest ever debut bond for sub-investment grade issuer in Eastern Europe, the Middle East and Africa
– Largest ever sub-investment grade corporate bond in the Middle East and Africa to date.
The Notes, which mature on February 8, 2014 and bear an interest rate of 7.875% per annum, are callable in the beginning of February 2010 and includes typical high yield bond covenants. The Notes are issued by Orascom Telecom Finance S.C.A., a Luxembourg finance subsidiary of Orascom Telecom, and are backed by a senior guarantee of Orascom Telecom, and are pari passu with Orascom Telecom’s US$2.5 billion senior secured bank facility. The issuer will then on-lend the proceeds to Orascom Telecom. The proceeds of the bond issue will be used by Orascom Telecom for general corporate purposes which may include investments in new and existing operations and purchases of Orascom Telecom GDRs. Bloomberg provides information on the Notes under the ticker ORAT EY.
Aldo Mareuse, Group Chief Financial Officer of Orascom Telecom, commented: “We are very pleased with the deal both as a benchmark bond for us and as a means of diversification of our sources of finance. The huge appetite for this offering reflects the strong business profile and credit quality of Orascom Telecom.
Orascom Telecom was rated Ba3 and B+ and the Notes were rated B2 and B- by Moody’s and Standard and Poor’s, respectively. Credit Suisse and Citigroup were Joint Bookrunners and Joint Lead Managers for the issuance of the Notes, with ABN AMRO and Deutsche Bank acting as Co-Managers on the issue.