Commercial Bridge Loan

Foreign loans in demand

Calcutta, July 5 : Telecom players are refinancing their high-cost domestic loans that were used to win expensive 3G licences with cheaper loans from abroad.

Six telecom firms Tata Teleservices, Tata Teleservices (Maharashtra), Aircel, Idea Cellular, Reliance Communication and Infotel Broadband have raised $3.705 billion (approximately Rs 16,500 crore) through external commercial borrowing between September 2010 and May.

Last year, seven telecom companies (excluding state-owned BSNL and MTNL, which already had 3G spectrum prior to the 3G auction last year) had paid nearly Rs 68,000 crore to obtain 3G licences, including spectrum.

These companies had sourced Rs 36,000 crore of a total payment of Rs 68,000 crore as short-term loans such as the sale of commercial papers and bridge loans from banks.

“Most of these debts were short-term borrowings in the form of bridge loans with a maturity of one and one-and-a half years,” said Sangeeta Tripathi, a telecom sector analyst at Sharekhan.

“Telecom companies would have to refinance these bridge loans anyway. The process has just started,” she said.

According to Tripathi, for companies yet to roll out 3G services, the bridge loans and the interest liability thereon are now capitalised to the balance sheet of individual companies.

“Once they start rolling out 3G services, the loan and the interest liability will be accounted for in the profit and loss account,” she said.

“The refinancing of high-cost domestic loans with cheaper external commercial borrowings is thus only sentimentally positive and its actual impact on profit and loss of individual telecom companies can be ascertained once they roll out 3G services and charge the interest liability in the profit and loss account,” Tripathi said.

Reliance Communication has so far raised $1.585 billion (approximately Rs 7,053 crore) in January and March this year the highest among the six companies that have tapped external commercial borrowings followed by Infotel Broadband ($1 billion) and Tata Teleservices ($750 million), including Tata Teleservices (Maharashtra).

Reserve Bank data shows that telecom companies have taken these overseas loans for longer terms of between five years and 10 years.

Commercial Bridge Loan - News

Foreign loans in demand

These companies had sourced Rs 36000 crore of a total payment of Rs 68000 crore as short-term loans such as the sale of commercial papers and bridge loans from banks. “Most of these debts were short-term borrowings in the form of bridge loans with a

New Jersey Asks JP Morgan For $2.25 Billion Loan

New Jersey officials are considering taking a $2.25 billion "bridge loan" from JP Morgan to close the state's cash shortfall, the Wall Street Journal reports. The unconventional move would make New Jersey the first state to tap a major commercial bank

Joburg: We're not in financial crisis

Commercial paper, according to the report, is a low interest, short-term loan for financing short-term liabilities and banking facilities and is used to bridge "short-term liquidity short-falls". Makhubo said the commercial paper was cost effective and

Saab Secures New Funds

STOCKHOLM—Saab Automobile owner Swedish Automobile NV said Wednesday it secured a €25 million ($35.9 million) bridge loan from hedge fund Gemini Investment Fund that will allow it to restart production soon.

Is Johannesburg going bust?

The loans will come in the form of a R3.5-billion commercial paper and a R920-million general banking facility. A commercial paper is a short-term loan used to finance pressing liabilities, while banking facilities are generally used to bridge

Lowest Cost Commercial Bridge Loans in 10 Years – from 7.99% APR ...

Some people will argue that it’s been even longer than 10 years since private money loans were priced as low as they are now. Because the private money lending arena is extremely liquid right now, borrowers are able to lock in very competitive private money interest rates. With rates on commercial from 7.99% APR, borrowers who had big credit hits can still lock in reasonable rates on private money bridge loans from non-bank lenders.

However, there are many false lenders and brokers on the web these days, and it’s becoming harder and harder to actually find the money. If you would like to get an idea of terms and requirements on the lowest cost commercial bridge loans in the Western U.S., please comment on this discussion or contact us via the “contact us” page.