MegaFon secures USD500m loan with China Development Bank

14 Oct 2014

Russia’s second largest mobile operator by subscribers, MegaFon, has received a loan worth USD500 million from China Development Bank Corporation (CDB) for the procurement of equipment and services from Chinese vendor Huawei Technologies. The terms of the agreement were not disclosed.

Commenting on the loan signing, MegaFon CEO Ivan Tavrin said: ‘This financing is another milestone in our long-term relationship with CDB. It underlines MegaFon’s high credit quality and the trust that our partners place in us as we continue to enjoy strong access to international capital markets as well as focus on enhancing our relationships with lenders and equipment suppliers globally.’

According to TeleGeography’s GlobalComms Database, MegaFon’s consolidated subscriber base increased to 70.20 million by end-June 2014, of which 67.99 million are based in Russia; MegaFon’s subsidiaries include Megafon-Tajikistan (formerly TT Mobile), Aquafon in the Republic of Abkhazia and Ostelecom in the Republic of South Ossetia. The company booked consolidated revenues of RUB76.666 billion (USD2.143 billion) for Q2 2014, a 6.1% increase year-on-year. Operating income before depreciation and amortisation (OIBDA) remained stable at RUB34.298 billion for the April-June period, while net profit increased 2.2% to RUB13.886 billion. Capital expenditure for 2Q14 increased 60.6%, from RUB8.343 billion to RUB13.396 billion.

Russia, MegaFon