RIYADH, 19 February — The Saudi Telecommunications Co. will introduce reduced rates for mobile telephones from March 11, according to company sources.
The sources said a decision by the company's board of directors to cut the call rates from SR1.20 to SR0. 95 per minute, was awaiting approval from the Ministry of Finance and National Economy.
The company will also offer an off-peak discount of 50 halalas per minute to all mobile phone users. The discounted rates will apply from 11 p.m. to 9 a.m. on week days and for 24 hours on Thursdays and Fridays.
The mobile connection charge will also go down to SR800 from SR1,500 and for family mobiles the new fee will be SR400 instead of the earlier rate of SR500.
Meanwhile, STC has signed a SR2.5 billion loan with regional banks to help finance its expansion, bankers said yesterday. They said four banks that were mandated in December to arrange the four-year loan completed the syndication in late January and later signed the loan with STC.
The mandated banks are Arab National Bank, Riyad Bank, Saudi British Bank and Arab Bank. The other banks that joined the syndication are Citibank, Al-Jazirah Bank, National Bank of Bahrain, the Saudi Investment Bank, Saudi Hollandi Bank and the Arab Investment Company.
The bankers would not give the pricing of the loan, but some media reports had put it at 45 basis points over LIBOR. The bankers said the loan would help STC finance capital projects to expand and develop Kingdom's fixed telephone line network and mobile phone network as well as Internet and information services projects.
The state-run telecommunications services was transferred to STC in 1998 as part of Kingdom's plan to privatize the sector. STC is also responsible for the infrastructure serving Internet system in the Kingdom and is evaluating bids to expand Internet and data transmission capacity.
Bankers had said key to the privatization of the Saudi telecoms sector was STC choosing a strategic partner. STC late last year ended a strategic partnership deal with US-based SBC Communications which would have given the US firm a stake of 20 to 40 percent in STC's $12 billion capital. Officials said then the Kingdom was studying a possible new strategy to privatize the telecoms sector and was in search of a new strategic partner.
