South Africa’s second fixed-line operator, Neotel, has signed a R2-billion bridging-debt facility with a consortium of domestic financial institutions.
”The facility has been fully underwritten by the funding consortium comprising Nedbank Capital, the investment banking business of the Nedbank Group, Investec Bank Limited, and the Development Bank of Southern Africa,” the company said in a
statement on Tuesday.
The consortium, Neotel said, would jointly finance R1,4-billion of the debt while the balance would be financed by the Industrial Development Corporation of South Africa.
Launched in August, the operator is set to break Telkom’s decades of monopoly over the fixed-line telecommunication business and offer stiff competition to the semi-state owned operator.
Welcoming the deal, Neotel managing director Ajay Pandey said the transaction would make it easier for the operator to execute its mandate.
”The finalisation of the funding ensures that Neotel continues to remain on track with the roll out of its promised services.
”Attractive terms for the debt have been offered by the financial institutions to ensure that Neotel is allowed adequate time to establish itself in the market,” he said.
The company intends to utilise the funds for its network build-out. — Sapa