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TECOM Group secures refinancing for existing loan facility at more favourable terms

15 June 2023
Press Release

TECOM Group PJSC (DFM: TECOM), (the “Company” or the “Group”), the creator of specialised business districts and vibrant communities, today announced it has entered into a new five-year AED 7.6 billion unsecured loan facility (the “Facility”) replacing the existing partially utilised term loan of AED 7.6 billion. The Facility will have a positive impact on the Company’s cash flow profile while providing it with the funds to execute its growth strategy.

The facility has been secured at more favourable terms, leading to immediate interest expense saving over the five-year period. The Facility provides drawdown flexibility till maturity and also increases the duration. It is split into an AED 4.4 billion term loan, which is equivalent to the amount that has already been drawn down from the previous agreement, and an AED 3.2 billion revolving credit facility, equivalent to the existing undrawn amount. The Facility has a bullet principal repayment structure, with the principal amount repaid at maturity.

Abdulla Belhoul, Chief Executive Officer, TECOM Group, said: “The new facility will provide us with greater financial flexibility, lower our borrowing costs, and enhances our leverage position. Importantly it enables us to invest in the growth of our business to unlock greater value for our shareholders.
The new facility demonstrates our ability to leverage our strong financial standing and performance, market reputation and leadership position within the commercial real estate segment to take advantage of the ample liquidity in the UAE banking sector.  Furthermore, securing the loan at more favourable terms is a reflection of the confidence the financial community has in our business and growth plans.”

Michael Wunderbaldinger, Chief Financial Officer, TECOM Group, said: “Through our proactive efforts and prudent approach to optimise our cost of capital, we have entered into a loan agreement that will have an accretive impact on our bottom line. The new facility will also lower our financial costs, improve our cash profile and is more aligned with our funding needs over the coming period.”

Abu Dhabi Commercial Bank PJSC, Emirates NBD Capital Limited, and Dubai Islamic Bank PJSC are the Joint Mandated Lead Arranger for the new facility.