Dubai-based telecoms provider du has secured a five-year $720m loan to replace two debt facilities and lower funding costs, Reuters reported, citing two banking sources.
The two debt facilities are a $220m three-year loan from Emirates NBD, Mashreq, NBAD and Samba, that expires in June, and a $500m facility due to run until 2017 funded by ADCB, Mashreq, NBAD and Samba.
The replacement loan is to be provided by Abu Dhabi Commercial Bank, National Bank of Abu Dhabi and Saudi Arabia's Samba Financial Group and du will pay interest of 140 basis points above the London interbank offered rate (Libor).
Bankers not involved in the deal have commented that given the lifecycle of the loan, du has negotiated a very cheap repayment rate.
"There have been talks for maybe three to four months between the company and banks but while they wanted five years, the most that banks were prepared to offer was three years - especially at the pricing levels they wanted," said one of the bankers not involved in the transaction.