Text size:

  • Small
  • Normal
  • Large

Zain Saudi tumbles as debt extension sought

What's Down: The Saudi Arabia-based telecommunications company headed for the lowest close on record after it was reported that it was seeking a fourth extension on $2.6 billion in debt.

Mobile Telecommunications Company of Saudi Arabia headed for the lowest close on record after MEED magazine reported the company known as Zain Saudi was seeking a fourth extension on US$2.6 billion in debt.

The shares of Saudi Arabia's third mobile-phone provider dropped 1.94 per cent to 7.60 riyals, set for the lowest close since the stock was listed in March 2008. Zain Saudi has tumbled 7.8 per cent in the past three days.

Zain Saudi said last month it was in "very advanced negotiations" with a syndicate of banks as well as potential investors to refinance the Islamic murabaha facility, which was first due in July.

Citing unidentified sources, MEED reported on its website that the company wrote to banks seeking a two-month extension.

Zain officials did not immediately comment yesterday.

"Until they secure an agreement with lenders, they'll just roll over the debt for shorter periods," said Asim Bukhtiar, the head of research at Riyad Capital.

"What would be surprising is if they say they can't agree on terms with the lenders, as that would create liquidity problems."

The company mandated Al Rajhi Bank, Banque Saudi Fransi, Arab National Bank and Standard Chartered to refinance the debt, said two bankers familiar with the matter .

Zain Saudi has posted full-year losses since starting operations in the largest Arab economy in 2008, according to data compiled by Bloomberg.

The company's third-quarter loss widened to 493 million Saudi riyals from 484m riyals a year earlier.

Seven analysts recommend investors hold the shares, while three have a sell rating and one says buy, according to data compiled by Bloomberg.

Zain Saudi shares have tumbled 32 per cent this year, compared with a 1.5 per cent gain for the benchmark Tadawul All Share Index.

Back to the top

More articles


Editor's Picks

 Marina Square apartments Reem Island: Q1 2% rise. Studio - Dh65-68,000. 1BR - Dh75-95,000. 2BR - Dh110-145,000. 3BR - Dh170-190,000. Q1 2013-Q1 2014 no change. Sammy Dallal / The National

In pictures: Where Abu Dhabi rents have risen and fallen, Q1 2014

Find out how rental prices in the prime locations in Abu Dhabi have altered during the first three months of the year and the current rates you will pay according to data provided by Asteco.

 A Brabus Mercedes 6x6 Sports Utility Vehicle is readied for display during Auto China 2014 in Beijing, on April 20. Adrian Bradshaw / EPA

In pictures: Auto China 2014 exhibition

Leading automakers have gathered in Beijing for the kickoff of China’s biggest car show, but lacklustre growth and environmental restrictions in the world’s largest car market have thrown uncertainty into the mix. More than 1,100 vehicles are being showcased.

 The New York Stock Exchange. Rising interest rates will shift momentum away from bonds and back towards risk assets such as stocks. Richard Drew / AP Photo

Plan ahead for rising interest rates

It is now over five years since the majory central banks slashed interest rates to record low but that is all about to change. So, how will rising interest rates affect you?

 The Wind, Energy, Technology and Environment Exhibition takes place from April 14 to April 16. Above, the Dewa showroom during last year’s Wetex. Jaime Puebla / The National

April corporate and economic calendar for the UAE and overseas

From Cityscape to Wetex to stock-market holidays to nations reporting first-quarter GDP figures, here is our helpful calendar of April's business events in the UAE and internationally.

 The Greens, villas: Q1 no change. 3BR - Dh210-250,000. 4BR - Dh210-260,000. 5BR - Dh220-300,000. Q1 2013-Q1 2014 5% rise. Pawan Singh / The National

In pictures: Where Dubai rents have risen and fallen, Q1 2014

Find out how rental prices in the prime locations in Dubai have altered during the first three months of the year and the current rates you will pay according to data provided by Asteco.

 Get the latest information on credit cards, bank accounts and loan products in the UAE. Mark Lennihan / AP Photo

Rates report: Latest on UAE loans, accounts and credit cards

Souqamal.com brings you the latest interest rates on banking products in the UAE.

Events

To add your event to The National listings, click here

Get the most from The National