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Qatar Telecom to raise $1b from 10-year bond sale
December 13, 2012
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DUBAI: Qatar Telecom (Qtel), the majority state-owned telecoms operator, is looking to raise $1 billion from a ten-year bond, lead arrangers said on Wednesday, in its first bond market foray in more than two years.

Final price guidance for the bond, maturing February 2023, has been set at a spread of between 175 —180 basis points over US Treasuries, a document released by lead arrangers showed, and the bond will price within this range.

Guidance tightened from indications earlier in the day due to strong demand for the bond. Order books were north of $11 billion at 1000 GMT, according to IFR Markets, a Thomson Reuters unit.

Top Gulf corporates are taking advantage of tightening spreads by raising money from the bond markets to meet their expansion and refinancing needs.

The former monopoly, rated A by Standard & Poor’s, which last tapped global debt markets for $2.75 billion in the fourth-quarter of 2010, is expected to price the bond on Wednesday.

 Yields on its existing bonds have fallen significantly, reducing Qtel’s borrowing costs.

Qtel has been raising stakes in its subsidiaries, taking advantage of the gas-rich Gulf state’s healthy financial position at a time when other large telecom firms are shying away from deals.

 It increased its stake in Iraqi telco Asiacell and Kuwaiti affiliate Wataniya this year.

Qtel also hired J.P. Morgan Chase to advise it on a potential bid for Vivendi’s Maroc Telecom, sources told Reuters earlier in December.

Barclays Plc, HSBC Holdings, Mitsubishi UFJ Securities, Mizuho Securities, Morgan Stanley Inc and QNB Capital as lead arrangers and bookrunners for the deal.

Meanwhile, the Abu Dhabi-listed Union National Bank will sell an additional $250 million in bonds to its existing 2016 maturity, arranging banks said on Wednesday.

The bond was launched at 2.65 per cent, slightly tighter than guidance indicated earlier in the day, signalling demand for the deal was healthy.

A tap means the new bond is issued at original face value, maturity and coupon but sold at current market price.

Yields on UNB’s $400 million 2016 bond, which carries a coupon of 3.875 per cent, have tightened this year, thus lowering the issuer’s borrowing costs.


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