Zain Saudi extends maturity of $600m facility

Updated 04 April 2013
0

Zain Saudi extends maturity of $600m facility

DUBAI: Zain Saudi has extended the maturity of a $600 million facility until May 1, according to a statement on Saudi Arabia’s bourse, the latest debt roll over by the loss-making firm.
This was due to be repaid on April 3, but Zain Saudi — an affiliate of Kuwait’s Zain — has extended the junior debt with the agreement of a lending syndicate led by Arab National Bank, and now has about $3 billion in loans maturing within the next four weeks.
The operator, which has yet to make a quarterly profit since launching services in 2008, last week extended a $2.4 billion Islamic loan to April 30.
This murabaha facility — a Shariah-compliant cost-plus-profit arrangement — was originally due in July 2011, but has been put back multiple times.
Zain Saudi has said these extensions were to finalize the terms of a new financing deal to replace the murabaha and it gave a similar explanation for extending the junior debt, which is subordinate to the Islamic facility.
Zain Saudi had liabilities of SR19.5 billion ($5.2 billion) at 2012-end and it has struggled to compete against better-resourced Saudi Telecom Co. (STC) and Mobily, an affiliate of Etisalat, which between them claim nearly 85 percent of the Kingdom’s mobile subscribers.
Zain Saudi made an annual loss of SR 932 million in 2012, compared with a loss of SR 811 million a year earlier and its revenue also fell 4.4 percent over the same period.
Zain upped its stake in Zain Saudi to 37 percent from 25 percent as part of its affiliate’s capital restructuring in June, oversubscribing to a rights issue following a tepid response from other shareholders.
Zain Saudi’s shares ended 0.6 percent higher on the Saudi bourse, 8 percent above November’s record low.


Iran rial plunges to new lows as US sanctions loom

Updated 24 June 2018
0

Iran rial plunges to new lows as US sanctions loom

  • The dollar was being offered for as much as 87,000 rials, compared to around 75,500 on Thursday
  • The currency has been sliding for months because of a weak economy

DUBAI: The Iranian rial plunged to a record low against the US dollar on the unofficial market on Sunday, continuing its slide amid fears of returning US sanctions after President Donald Trump in May withdrew from a deal on Tehran’s nuclear program.
The dollar was being offered for as much as 87,000 rials, compared to around 75,500 on Thursday, the last trading day before Iran’s weekend, according to foreign exchange website Bonbast.com, which tracks the unofficial market.
Iran’s semi-official news agency ISNA said the dollar had climbed to 87,000 rials on Sunday from about 74,000 before the weekend on the black market, and several Iranian websites carried similar reports.
The currency has been sliding for months because of a weak economy, financial difficulties at local banks and heavy demand for dollars among Iranians who fear the pullout by Washington from the nuclear deal and renewed US sanctions against Tehran could shrink the country’s exports of oil and other goods.
The fall of the national currency has provoked a public outcry over the quick rise of prices of imported consumer goods.
Merchants at the mobile phone shopping centers Aladdin and Charsou in central Tehran protested against the rapid depreciation of the rial by shutting down their shops on Sunday, the semi-official news agency Fars reported.
A video posted on social media showed protesters marching and chanting “strike, strike!” The footage could not be authenticated independently by Reuters.
Hours later, Information and Communications Technology Minister Mohammad Javad Azari-Jahromi said on Twitter that he visited the protesting merchants.
“I will try to help provide hard currency for (mobile) equipment (imports),” Azari-Jahromi wrote, adding: “The merchants’ activity has now gone back to normal.”
Some of the US sanctions against Iran take effect after a 90-day “wind-down” period ending on Aug. 6, and the rest, most notably on the petroleum sector, after a 180-day “wind-down” period ending on Nov. 4.
The rial has weakened from around 65,000 rials just before Trump’s announcement of the US withdrawal in early May, and from 42,890 at the end of last year — a freefall that threatens to boost inflation, hurt living standards and reduce the ability of Iranians to travel abroad.
In an effort to halt the slide, Iranian authorities announced in April they were unifying the dollar’s official and black market exchange rates at a single level of 42,000, and banning any trade at other rates under the threat of arrest.
But this step has failed to stamp out the unofficial market because authorities have been supplying much less hard currency through official channels than consumers are demanding. Free market trade simply went underground, dealers said.