Cell Cash

June 8, 2007 (LBO) – The cellular operator Mobitel has raised five billion rupees through a syndicated loan to fund its expansion into rural Sri Lanka, officials said. The 8-year loan was syndicated by HSBC Sri Lanka. Bank of Ceylon, Peoples' Bank, Hatton National Bank and HSBC itself brought in a billion rupees each while the National Development Bank and Sampath pitched in with 500 million rupees.

Mobitel Chairman Asoka Weerasinghe says the money will go to fund its GSM expansion and new third generation services.

"The total investment of Mobitel on GSM services would be amounting to over 200 million dollars with this investment," he said.

The loan comes with a two year grace period and will be paid back in 8 semi-annual installments.

HSBC said the syndication was oversubscribed.

"Being one of the largest rupee syndications in Sri Lanka, this goes to show the trust and confidence investors have in Mobitel," HSBC Sri Lanka CEO David Griffiths said,

Sri Lanka's telecom sector is one of the fastest growing sectors in Sri Lanka, with the mobile sector leading the growth.

India's Airtel has been licensed to enter the market. Dialog Tel