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Johannesburg - MTN, Africa's biggest cellphone operator, is issuing bonds worth up to R8bn to help fund its planned acquisition of Investcom, MTN said on Wednesday.
An MTN spokesperson said the company was issuing the bonds in two tranches with 4-year and 8-year maturities and had kicked off a roadshow in Cape Town on Wednesday.
"The issue is up to R8bn, split into two tranches of 4 years and 8 years," the MTN spokesperson said.
She could not immediately give details on pricing.
MTN announced last month it had agreed to buy Dubai-based telecoms operator Investcom for $5.5bn in a deal that will give it a foothold in new emerging markets and make it the second biggest operator in the Middle East and Africa.
It said at the time it planned to fund part of the transaction through a $3.85bn bridging facility committed by Deutsche Bank AG, and the rest by issuing new shares.
The company said it would refinance the bridging facility within six months and could include local and international bank funding from debt capital markets.
"In determining the final funding mix, MTN group will take into consideration the ultimate cash settlement required, the progress of the Investcom offier and prevailing market conditions," MTN said in a circular to shareholders this week.
South African newspapers quoted Finance Director Rob Nesbit as saying MTN would start selling bonds worth R8bn on Wednesday in a sale led by Deutsche Bank.
Shares in MTN rose 1.82% to R52.45 by 10:32, in line with a 1.94% rise on the Johannesburg Top-40 index of blue-chip stocks.