Banglalink Digital Communications has become the first-ever issuer from the country to tap the international bond market with its inaugural $300m senior note offering.
The second largest mobile phone operator in the country which has a subscriber base of more than 2.9 crore made this historic transaction on April 25, a press release said yesterday.
The deal involved engagement with various regulators in Bangladesh to help setting up a framework for corporate bond issuance in the international bond markets, according to sources close to the matter.
The company plans to use the proceeds to repay existing debts and to finance capital expenditures. Citi acted as the sole bookrunner and ratings adviser to Banglalink.
“This transaction is a major milestone for Banglalink and further diversifies our sources of funding into international capital markets. We are very pleased with the support of so many high quality global investors for this inaugural offering,” said Ziad Shatara, chief executive officer of Banglalink.
The Reg S/144A bonds were priced at 99.008% with a coupon of 8.625% for a yield of 8.875%. The five-year non-call three bonds have standard high yield covenants with limitation on indebtedness.
In executing the transaction, Banglalink conducted a global roadshow in April covering Asia, Europe and the US when the management met with over 75 investors globally through 37 investor meetings, two group luncheons and multiple investors’ conference calls, according to global media reports.
The investor meetings resulted in early indication of interests in excess of $600m towards the end of the roadshow with the initial pricing thoughts announced at 9% area on April 16.
The final price guidance was released during the London morning session on April 24 at 8.875% area, with the order book growing to $900m from over 90 accounts globally through the 24 hours until pricing.
In terms of geographic distribution, 64% of the bonds were sold in Asia, 29% in Europe and 7% in the US. By investor type, asset managers accounted for 72%, private banks 17% and banks 11%.
Banglalink, a wholly-owned subsidiary of Cairo-based Global Telecom Holding (GTH) – a sister concern of Vimpelcom Limited, is the sixth largest mobile telecommunication group in the world.
