South African fixed line telecom operator Neotel, in which India's Tata group holds 26 per cent stake, has raised 4.4 billion rand (about Rs 220 crore) from a consortium of financial institutions.
This increases the company’s total project finance to 7.5 billion rand (approximately Rs 375 crore). The total funding — which was raised through a combination of debt and equity over two years — would be used to replace all its existing bridging finance.
The debt facilities were arranged by three leading financial institutions in South Africa — Nedbank Capital (the investment banking division of Nedbank), Investec Bank and the Development Bank of Southern Africa, Neotel said in a release.
“On December 12, 2006, we signed a bridging finance facility to the value of 2 billion rand to get the process started of building our network,” said Ajay Pandey, managing director and chief executive officer of Neotel.
“We continue to grow our network aggressively to ensure that customers have access to the value adds that we bring to the telecommunications market,” said Pandey.
Tata Communications holds around 25 per cent stake in Neotel and 1 per cent by other Tata companies. Tata group is in the process of acquiring another 30 per cent stake in the company. The other shareholders in Neotel are Nexus, Communitel and Two Telecom Consortium.
