Financed ProjectsAlbtelecom

Identification Code:

OP/05/0506

Total Operation Cost:

173.000.000

Maturity:

90 months

Operation Status:

Description and Purpose of the Operation:

BSTDB finances the development of Albtelecom, the main Albanian telecommunications operator. The project involves the provision of financing to a consortium consisting of Calik Energy Telekomunikasyon and Turk Telekomunikayson A.S. to assist it in acquiring 76% stake in Albtelecom as a part of the privatization programme and partly finance Albtelecom’s capital expenditure programme. The capital investment programme includes investments to upgrade and expand the existing fixed-line network infrastructure, to build a new mobile GSM network and develop new broadband and data services. The Operation aims to ensure that Albtelecom is a modern telecommunications provider with consumer orientated service packages and an advanced communications network infrastructure providing services to both private and business users.

Countries of Operation:

Albania (100,00 %)

Financial Product:

Loans

Sector:

Telecommunication Services

Domain:

Private

Borrower/Client:

Albtelecom Sh.A., the Albanian incumbent fixed-line operator started its business in 1912 by providing telecommunications and postal services in Albania. Albtelecom was privatized in 2007, when the government sold the 76 percent stake to the Consortium of Calik Enerji and Turk Telecom.

Co-Financiers/Participants:

EBRD (A Lender together with BSTDB) and other commercial banks (B Lenders)

Guarantors/Sponsors:

a. CETEL Calik Enerji Telekomunikasyon Hizmetleri A.S.being the youngest but fastest growing member of Calik Group,a Turkish conglomerate operating with successful projects in power, oil &gas and telecommunications sector in Turkey as well as neighbouring countries. b. Turk Telekomunikasyon A.S. (Turk Telecom or TT), a company incorporated under the laws of the Republic of Turkey owning 20% of shares in Hold Co.

Developmental and Regional Cooperation Impact:

The operation has high economic development impact as it supports the upgrade and further development of the telecoms infrastructure in Albania and facilitates the mobilization of solid funding outside of the Black Sea region.It has an opportunity to create new employment and generate taxes, contributes to the generation of taxes. The operation also promotes regional cooperation by envisaging the involvement of a Turkish consortium in the privatization of the Albanian telecom company.

Environmental Classification and Impact (summary):

The Operation was classified C/1. The environmental assessment confirmed that there is no significant environmental, health and safety or social issues associated with this operation and Albtelecom is in compliance with all relevant Albanian environmental, health and safety standards and regulations. In order to bring the Company in line with international environmental management practices for the telecommunication sector, a number of issues have been identified. These include the development of a formal environmental policy and a proactive management system in accordance with the international standard ISO 14001.

Operation Leader:

Energy & Infrastructure

E-mail:

ei@bstdb.org