The Board of Directors (BoD) of International Finance Corporation (IFC) – a member of the World Bank Group – has approved debt financing of up to $400 million to Pakistan Telecommunication Company Limited (PTCL) after its acquisition of Telenor Pakistan (Private) Limited.

This was stated by PTCL which shared the development in its notice to the Pakistan Stock Exchange (PSX) on Monday.

“It is to inform that the Board of Directors of International Finance Corporation (IFC) has approved the debt financing up to $400 million to PTCL for the acquisition of Telenor Pakistan,” read the PTCL notice.

The company shared that the finalisation of workstreams to sign financing agreements with IFC is underway and expected to be completed on or before July 31, 2024.

“The details of the debt financing shall be disclosed upon the finalisation of financing agreements,” it added.

Following the announcement, PTC’s share price rose to Rs17.12, up 5.74% at the time of this report.

Last year, in a major consolidation of the telecom sector, PTCL entered into a Share Purchase Agreement (SPA) with the shareholders of Telenor Pakistan for the acquisition of 100% shares for Rs108 billion ($385 million) on a cash free, debt free basis.

Back then, PTCL informed that the acquisition would be financed by external debt.

“The transaction provides an opportunity for in-market consolidation in the telecom market which will predominantly lead to an improved long-term outlook of the telecom sector,” PTCL said in a statement then.

“The transaction will also improve the capabilities of the combined entities and result in improved coverage and quality of services to customers and enable wider access to communication solutions for businesses while supporting economic growth of Pakistan,” read the notice.

The telecom giant added that the transaction will further strengthen the position of PTCL Group as a leading operator in mobile, fixed, and micro-financing serving more than 70 million customers, upon completion of the transaction.

PTCL’s major assets include Ufone, a mobile operator in Pakistan with over 20 million customers. Etisalat, with a significant minority stake, runs it under an agreement with the government of Pakistan, which has the majority stake.

As per the company’s latest financial results, PTCL Group’s revenue increased by 25.8% YoY to Rs190.6 billion, mainly driven by strong performance in the consumer segment.