China Development Bank provides EUR 500 million loan to Turkcell to restructure the company’s existing loans (Linked to Record ID#67355)

Project narrative

On October 23, 2015, China Development Bank (CDB) issued a loan worth 1.25 billion euros to Turkcell İletişim Hizmetleri A.Ş. (“Turkcell”) — the largest (private) mobile phone operator in Turkey — to restructure the company’s existing loans and to help finance purchases from China for infrastructure investments. The loan has a 10-year maturity and a grace period of 3 years. The annual interest rate was expected to be 2.2 percent above the Euro Interbank Offered Rate (EURIBOR) of 0.027%. The loan was to be repaid in equal installments. Under the terms of the agreement, CDB agreed to provide the loan in two tranches: an EUR 500 million tranche (captured In Record ID#73232) and an EUR 750 million tranche (captured in Record ID#73233). The EUR 500 million tranche was to be used by the borrower to refinance some of the Turkcell Group’s existing loans. It was fully utilized (disbursed) as of October 2015. The EUR 750 million tranche was to be used by the borrower to finance certain procurement requirements from Chinese suppliers in relation to certain infrastructure investments by Turkcell Group. As of December 31, 2017, EUR 560 million of the EUR 750 million tranche was utilized (disbursed). Then, on March 5, 2018, the scope of the unutilized portion of the EUR 750 million loan tranche was expanded. In addition to Turkcell Iletisim Hizmetleri A.S., several subsidiaries of the Turkcell Group — Superonline Iletisim Hizmetleri A.S., Financell and lifecell LLC — were authorized to utilize the second (EUR 750 million) loan tranche. In addition to the right to utilize the tranche in EUR terms, it could also be utilized in USD and Renminbi with respective annual interest rates of LIBOR (0.794%) + 2.22% and 5.51%. There were no changes to maturity and the repayment schedule of the loan. The 1.25 billion euro umbrella agreement is captured in Record ID#67355.