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Overview

China Development Bank provides $200 million buyer's credit loan to Türk Telekom for purchase of Huawei products and services (Linked to Record ID#41609)

Commitments (Constant USD, 2023)$216,763,567
Commitment Year•2012Country of Activity•TurkeyDirect Recipient Country of Incorporation•TurkeySector•CommunicationsFlow Type•Loan

Status

Project lifecycle

Pipeline: Commitment

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Dec 26, 2012
First repayment (originally scheduled)
Jul 1, 2014
Last repayment (originally scheduled)
Dec 30, 2019

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

State-owned Policy Banks

  • China Development Bank (CDB)

Receiving agencies

Private Sector

  • Türk Telekom

Implementing agencies

Private Sector

  • Huawei Technologies Co., Ltd.

Loan description

China Development Bank provides $200 million buyer's credit loan to Türk Telekom for purchase of Huawei products and services

Grace period•2.5 yearsGrant element•25.2776%Interest rate (t₀)•3.36025%Interest type•Variable Interest RateLoan tenor•6-month rateMaturity•8 years

Narrative

Full Description

Project narrative

On December 26, 2012, China Development Bank (CDB) and Türk Telekomünikasyon A.Ş. (“Türk Telekom”) — a private telecommunications company — signed two buyer's credit loan agreements. The first loan (captured in Record ID#41608) had a face value of $200 million, a maturity of 8 years, a grace period of 30 months, and an interest rate of LIBOR (0.687% calculated as average 6-month LIBOR for 2012) + 285 basis points. The proceeds from this loan were to be used by the borrower to facilitate its acquisition of products and services from Huawei Technologies. The second loan (captured in Record ID#41609) had a face value of $400 million, a maturity of 8 years, a grace period of 2 years, and an interest rate of LIBOR (0.687% calculated as average 6-month LIBOR for 2012) + 340 basis points. The proceeds from this loan were to be used by the borrower to address its long-terms financing needs.

Staff comments

1. Türk Telekom was a state-owned enterprise until it was privatized in 2005. In November 2005, 55% of Türk Telekom was sold to Oger Telecom's Joint Venture Group. 2. No sources explicitly state that this is a buyer's credit loan. AidData assumes this is the case for the following reasons: (1) The loan is provided to a foreign borrower, (2) the loan is denominated in USD, (3) proceeds from this loan were to be used by the borrower to facilitate its acquisition of Chinese products and services