VimpelCom in $1 billion Chinese loan deal, says Telecel Zim self-financing

VimpelCom in $1 billion Chinese loan deal, says Telecel Zim self-financing

HARARE, November 25 (The Source) – Global telecommunications giant, VimpelCom, the parent company of Telecel Zimbabwe last week signed a $1 billion credit facility with the China Development Bank but said on Tuesday its local subsidiary will not benefit from the funding as it is self-financing.

The Netherlands-based firm, said the loan facility had an eight-year tenure and “will be used to fund capital expenditures for various operating companies.”

Besides Zimbabwe, VimpelCom has mobile telecoms operations in 13 other countries which include Algeria, Armenia, Bangladesh, Georgia, Italy, Russia and Ukraine with a combined subscriber base of over 220 million.

The firm’s head of media relations Artem Minaev said the loan facility was an additional funding option for the group which earlier signed a $500 million loan deal with another Chinese financial institution.

“We can’t say (much) about this credit facility more than (what has been said) in the press-release, because we will not necessarily use it. This facility is just an additional option for us,” Minaev said in a written response to The Source.

Asked if Telecel Zimbabwe would also get an allocation from the funds, the VimpelCom spokesman said the subsidiary generated its own income to fund its programmes.

“Telecel Zimbabwe is our self-financing company,” he said.

The country’s second biggest mobile telecoms operator by subscriber, Telecel Zimbabwe, mid-this year said it was on the hunt for $200 million to boost its capacity and increase its subscriber base.

The firm, which enjoys nearly 30 percent of the market share in a field dominated by Econet Wireless, is targeting to increase its active subscriber base to 3,3 million from around 2,3 million.

Telecel Zimbabwe became part of the VimpelCom group after the Russian company acquired a 51 percent stake in Egyptian telecoms firm, Orascom, which in turn holds a 60 percent stake in the local telecoms firm.