E-mail: bjanssen@ifc.org
US$210 MILLION TRANSACTION IN ROMANIA FOR GSM CELLULAR TELEPHONE NETWORK
Brigid Janssen
Phone: (202) 458-4698
Fax: (202) 974-4384
E-mail: bjanssen@ifc.org
WASHINGTON, D.C., April 23—The International
Finance Corporation, ING Barings (ING) and Société Générale (SG) have finalized
the largest private financing ever undertaken in Romania, for Mobil Rom
S.A., to establish a nation-wide Global System for Mobile Communications
(GSM) cellular telephone network.
The financing package consists of a US$210 million IFC investment, including
a senior loan of US$40 million and a subordinated loan of US$10 million,
both for the IFC account, and a syndicated B-loan of US$160 million for
the account of participating banks jointly arranged by IFC, ING and SG.
Mobil Rom, one of two private GSM cellular companies operating in Romania,
has a 10-year license granted in 1996 by the Ministry of Communications.
Since the start of operations in June 1997, Mobil Rom has out-performed
its original estimates and has already acquired 150,000 subscribers. The
financing package represents the initial three years of the company’s
investment program, together with the repayment of a US$100 million bridge
loan arranged by ING and SG.
The shareholders of Mobil Rom S.A., are France Telecom Mobile International
(FTMI), MediaCom ’95, Unimedia, Radcom, MBL Computers, Tomen Telecom Romania
and Alcatel Network Systems Romania. FTMI is the international arm
for the cellular operations of France Telecom, the main French telephone
operator, with investments in cellular operations in several Asian, European
and Middle-East-North African countries. MediaCom is a Romanian media
group involved in print and electronic media businesses. CME and
Computerland Group-USA, Tomen Corporation-Japan, and Alcatel-France are
other sponsors.
By making its first investment in Romania’s telecommunications sector,
IFC is helping to upgrade the country’s infrastructure while encouraging
more private initiatives. The three arrangers, IFC (Lender of Record),
ING (Security Agent), and SG (Bookrunner) have worked in close co-operation
towards the success of this major transaction for Romania and ten additional
international banks have joined the syndicated B-loan: Berliner Bank,
Banca Nazionale del Lavoro, Erste Bank, Banque Nationale de Paris, Crédit
Local de France-Dexia, Crédit Lyonnais, Kredietbank, Sakura Bank, Banque
Worms, and Cera Bank.
The loan agreement for the IFC Investment was signed on behalf of IFC by
Mr. Kent Lupberger, Manager of Telecommunications, and on behalf of Mobil
Rom S.A. by Mr. Andrei Chirica, President. Mr. Lupberger said, "Mobil
Rom provides access to cost effective and reliable telecommunications services,
thereby increasing efficiency and competitiveness, and promoting economic
development."
ING, a major international financial institution was the main arranger
and financier for telecom projects in Central and Eastern Europe in 1997.
Its strong local presence and its knowledge of the telecom sector
add to this record. Mr. Katz, head of Telecommunication Finance said, "the
Romanian market has enormous potential and Mobil Rom’s performance to
date is another example of the success of mobile telephony in the region".
SG, a major bank in project finance world-wide and IFR European Loan House
of the Year in 1997 has exploited its extensive global expertise in the
telecom sector for the benefit of its customers by arranging a large number
of telecommunications financings over the last year. Gaëlle Muller, Head
of Telecommunications and IT Project and Sectorial Finance said that "prospects
are good for Romania to be able to increase its access to the international
capital market. Based on its 21 years of presence in the country,
SG is well established in Romania and uses this unique position to serve
its clients’ needs with the highest standards".
IFC, part of the World Bank Group, fosters economic growth in the developing
world by financing private sector investments, mobilizing capital in the
international financial markets, and providing technical assistance and
advice to governments and businesses. To date, IFC has invested $2.3
billion in telecommunications projects world-wide, of which US$1 billion
was for IFC’s account.
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