Dubai: Fitch Ratings has assigned Emirates Telecommunications Corporation’s (Etisalat) $7 billion global medium-term notes programme and the 3.15 billion-euro equivalent senior notes issued under the programme final ‘A+’ ratings. The final rating assignment follows the receipt of final documentation confirming preliminary information reviewed.
The 3.15 billion-euro equivalent notes have been issued in tranches of 2.4 billion euros and $1 billion. The euro-denominated notes will mature in 2021 (1.2 billion euros) and 2026 (1.2 billion euros), while the $-denominated notes will mature in 2019 ($0.5 billion) and 2024 ($0.5 billion).
The issue proceeds, approximately 1 billion euros higher than originally targeted by the company, are being used to refinance existing loans to fund the acquisition of Maroc Telecom (MT). This will improve Etisalat’s debt maturity profile given the fairly short tenor of these existing loans.
The notes are rated at the same level as Etisalat’s ‘A+’ IDR and senior unsecured rating as they constitute direct, unconditional and unsecured obligations of the issuer and rank pari passu and equally with all other unsecured obligations. Terms and conditions of the documentation include negative pledge and cross default provisions as well as limitations on the transfer of the UAE’s telecommunications license by Etisalat. No change of control provision is contemplated in the bond documentation should the Government of the UAE cease control of Etisalat. The notes are governed by English law.
