WASHINGTON, D.C., July 26, 2000
— The International Finance Corporation has mobilized US$35 million for Mobil Rom S.A. to expand its nation-wide Global System for Mobile Communications (GSM) cellular telephone network in Romania.
The financing package consists of a senior loan of $15 million for IFC's account, and a syndicated B-loan of $20 million for the account of participating banks. The financing represents IFC's second investment in Mobil Rom following a $210 million package that helped finance the launch of the company's cellular network in 1997.
Mobil Rom, one of three private GSM cellular companies operating in Romania, was recently awarded a 5-year extension to its 10-year license, which was originally granted in 1996 by the Ministry of Communications. Since starting operations in June 1997, Mobil Rom has exceeded original projections and currently has more than 850,000 subscribers. This package will finance a one-year expansion program, which will help the company further build out its network coverage and increase capacity.
The shareholders of Mobil Rom S.A. include France Télécom Mobile International (FTMI), Radcom, MBL Computers, Tomen Corporation-Japan, Alcatel N.V.-Netherlands and an AIG-led consortium of international institutional investors. FTMI is the international arm for the cellular operations of France Télécom, with investments in cellular operations in several Asian, European, Middle-Eastern and North African countries.
Five international banks that participated in the original investment joined the $20 million syndicated B-loan: ING Bank NV, Société Générale, Dexia, BNP Paribas and Banque Worms.
Doug Coulter, an Investment Officer in IFC's Global Information and Communication Technologies Department called Mobil Rom a Romanian success story. He said the company is a leader in providing reliable and affordable telecommunications services which in turn are upgrading Romania's infrastructure and contributing to Romania's economic development.
The mission of IFC, part of the World Bank Group, is to promote private sector investment in developing countries, which will reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, and provides technical assistance and advice to governments and businesses. To date, the ICT Department has invested $2.6 billion in telecommunications and Internet projects worldwide, of which approximately $1.2 billion was for IFC's account. Further information regarding IFC's activities in the sector can be found at
www.ifc.org/ict
.
