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Best murabaha deal: Mobile Telecommunications Co

Pushing beyond the boundaries

The $1.2 billion Murabaha facility for Kuwait’s Mobile Telecommunications Co was solid proof of the growing appetite worldwide for Middle Eastern corporate risk in an Islamic finance format.

Saad Rahman, director of the global Islamic banking department at Calyon in Bahrain, which acted as one of the mandated lead arrangers of the transaction, says that the 28 financial institutions that participated in the syndication of the 12-month term loan were a well-diversified mix of lenders from Asia, Europe, the Middle East and North America.

As well as attracting a broad spectrum of commitments from different financial centres, the deal also indicated that well-known corporate names from the Middle East do not face any danger of funding fatigue among lenders.

December’s transaction refinanced an earlier $750 million transaction signed in February 2006 and on the back of that transaction MTC and its arrangers were able to attract a substantial oversubscription that enabled an increase in the size of the loan to $1.2 billion.

Calyon’s Rahman says this latest transaction sets the stage for further successful Islamic financings for MTC in 2007.

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