Telkom Kenya seeks emergency funds

Shortage of cash could cause telco to default on debts - report
Mickael Ghossein, CEO, Telkom Kenya.
Mickael Ghossein, CEO, Telkom Kenya.

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Telkom Kenya is seeking an emergency short term loan of about Ksh5.8 billion ($69 million) from the Kenyan government and its parent company, France Telecom, according to a report from Kenyan weekly, The East African.

The telco requires a loan to last until June to avoid a cash crisis that could see it default on debt payments, the report stated.

Telkom Kenya needs requires the emergency loan to repay two unsecured loans from Standard Chartered Bank worth Ksh7.6 billion ($616 million), which are due to be repaid in the next two months, according to the East African report.

The operator also owes KCB Ksh1.5 billion ($122 million) in an overdraft loan, which is due for renewal in August 2012, and a Ksh1 billion ($81 million) one-year loan, which is due for renewal in November.

The report added that the company is requesting a total of about Ksh10.5 billion ($125 million) bailout from its shareholders in 2012.
 

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