Dr. Saad Al Barrak, Deputy Chairman and Managing Director of MTC Group explained that the $5 billion negotiation with international banks is not for a loan but credit facilitation in preparation for funding the continuous expansion strategy that began in 2003. This is in line with MTC’s objectives to be prepared and to have the funds ready at hand excluding the need for loans.
Dr. Barrak explained, “These credit facilities are much more beneficial than direct loans because it costs less and gives MTC the flexibility and more ease to maneuver when it acquires new companies.”
Previously, MTC had taken a Bridge Loan for the acquisition of Celtel. The Bridge Loan was to be repaid within a year and was only provided to give a chance for MTC to restructure its financial standing. MTC then increased its capital by100% and paid back in full the loan for Celtel which amounted to $3.3 billion. Dr. Barrak stated, “The increase in Capital was only achieved after the company doubled its profit. The successful capital increase of $2.5 billion shows the trust that shareholders have in our strategy and our vision.
Today, MTC Group boasts of 15 million customers. Dr. Barrak stressed that MTC is still seeking to expand in the Middle East, Africa and surrounding region. “ We are still interested in countries such as Iran, India, Pakistan, Turkey as well as Egypt which we consider as very important and very challenging project.”
MTC is very pleased with its recent acquisition of Celtel which surpassed its expectations in terms of growth. “We expected Celtel to reach 15 million customers by 2009, but we have revised these expectations because in 6 months Celtel grew from 5 million customers to 8.5. We believe that in 2006 Celtel will reach 14 million which is a great achievement by any standards.”
Since MTC took over Celtel in March of 2005, Celtel’s stakes in its markets has increased. For example its stake in Tanzania was 30% and today is 60%, as in Sudan where negotiations are finalizing to have 100% stake. Dr. Barraked concluded, “ We are still expanding in Africa and are looking into markets such as Ghana Nigeria and others we cannot mention today.”
