MIGA guarantees USD450m Murabaha loan for Axis Indonesia expansion

23 Jun 2011

The Multilateral Investment Guarantee Agency (MIGA), the political risk insurance arm of the World Bank Group, says it has provided USD450 million in investment guarantees to support the expansion of PT Natrindo Telepon Seluler (branded Axis Indonesia’s) telecoms services in the country. MIGA’s guarantees are backing a Murabaha financing facility that is being underwritten by Deutsche Bank and Saudi British Bank (SABB), it said. Further, the MIGA-backed Islamic financing facility forms part of a bigger USD1.2 billion package put together to enable Axis Indonesia to expand its GSM and 3G mobile networks. The cellco, which already boasts coverage of more than 400 cities across the country, is looking to increase network quality, expand coverage and build more network capacity. Axis hopes the expansion will enable it to target lower-income segments of the market as well as reaching remote islands of the archipelago, where telecoms access is considered ‘a particular challenge’.