CamGSM secures Chinese loan for expansion, debt refinancing

Cambodia’s largest mobile operator by subscribers, CamGSM, has secured a USD591 million loan from Chinese banks to help finance a contract with equipment supplier Huawei Technologies, the Financial Times reports. CamGSM, which operates under the Mobitel brand, has signed a five-year deal with the Chinese vendor worth USD500 million, for the supply of equipment and services in order to expand its wireless network. A proportion of the funds will also enable the cellco’s parent, the Royal Group of Cambodia, to refinance a USD421 million loan used to buy out a majority stake in CamGSM from Luxembourg’s Millicom International Cellular (MIC) in August 2009. According to TeleGeography’s GlobalComms Database, CamGSM was established in April 1996 as a joint venture between MIC (58.4%) and the Royal Group (41.6%). The same month it was awarded a 25-year (extended to 35 years in 1999) GSM-900 licence. Services were launched in March 1997, with 3G W-CDMA and 3.5G HSDPA services following in October 2006 and March 2008, respectively. As part of a wider strategy to divest its operations in the Asian market, MIC sold its stake in CamGSM to the Royal Group in August 2009 for USD346 million in cash, raising its local partner’s shareholding to 100%. The deal received regulatory approval the following November.