39715 - Zain Iraq II

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Summary of Investment Information

Project Number

39715

Company Name

ATHEER TELECOM IRAQ LIMITED

Date SPI Disclosed

Jan 24, 2018

Country

Iraq

Region

Middle East

Projected Board Date

Feb 28, 2018

Environmental Category

B - Limited

Status

Completed

Last Updated Date

Jun 25, 2021

Department

Regional Industry INF MCT

Industry

Telecommunications and Technology

Previous Events

Approved : Feb 28, 2018
Signed : May 30, 2018
Invested : Aug 15, 2018

Sector

Mobile Telephony

Project Description

The proposed project is a syndicated loan facility of up to US$300 million (“Loan”) to Atheer Telecom Iraq Limited (“Zain Iraq” or “The Company”), a leading Mobile Network Operator (“MNO”) in Iraq and also an existing IFC client. The Loan will be guaranteed by the parent of Zain Iraq, Mobile Telecommunications Company KSC (“Zain Group”, the “Group” or the “Sponsor”), a Kuwait-based MNO group with operations in 9 countries across Middle East and Africa. The proposed investment will be used to support the investment program of the Company in 2018-2019, including the enhancement of capacity and quality of the 3G network, which is the only means to access to broadband for many of the Iraq population, reconstruction of the 2G and 3G network that were damaged during the conflict with ISIS and expansion of the 3G coverage to currently unserved areas.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	100.0
Equity

Development Impact

(a) Project Impact Assessment- (i) increase availability and coverage of the 3G network in Iraq, thus increasing consumers' potential access to mobile broadband; (ii) improve the capacity and quality of the 3G mobile network, allowing consumers to use more data and data applications; (iii) contribute to Iraq's economic growth due to spillover effects across many sectors as a result of increase in mobile broadband penetration. (b) Market Impact Assessment- (i) Resilience - IFC anticipates the project will result in lasting systemic improvements in reconnecting the recently liberated areas with Baghdad, in the absence of landlines, and supporting crisis response and digital identity to displaced and refugee populations, (ii) Competitiveness - IFC anticipates that the project, by improving the capacity of data connectivity in the country, will help improve competitiveness of businesses in Iraq and stimulate innovation and entrepreneurship in the country as broadband will provide the businesses access to knowledge and information, banking and payment platforms and boost their productivity.

(a) Long Term Debt Financing: Due to political and macroeconomic instability, long term financing options in Iraq are limited. IFC's debt financing features longer tenor (7 years) than those currently available in the market. (b) Mobilization of Additional Debt Financing: IFC will assist Zain Iraq by mobilizing up to US$200 mm of financing from the MCPP as well as from other development finance institutions and commercial banks. IFC's repeat investment in the Company gives a positive signal to other lenders about the Company and the market. The Company would like IFC to lead the facility because of its successful track record of raising and managing mobilizations. (c) Knowledge of regulatory environment: The World Bank has been actively involved in working with Iraqi authorities to improve the capacity of regulatory bodies and develop a modern, transparent oversight framework. For example, the World Bank have organized workshops with the Iraq regulators on various topics including the ownership of the national fiber networks.

E&S Category Rationale / Risks and Mitigation

The project may result in a limited number of potentially adverse E&S impacts, which can be avoided or mitigated by adhering to recognized international industry performance standards or guidelines. This project is therefore classified as a category B according to IFC’s Policy on Environmental and Social Sustainability.

Key E&S issues associated with this proposed investment are: i) enhancing the training, monitoring and reporting component of the corporate ESMS to strengthen oversight on company contractors; ii) labor and working conditions of the employees, contractors and franchisers; iii) occupational health and safety of contractors; iv) management and monitoring of waste and hazardous materials; and v) assessing and mitigating social risks of company security arrangements vis a vis affected communities and company’s employees as the project operates in a fragile and conflict affected area.

Contacts

For Inquiries About the Project, Contact

ATHEER TELECOM IRAQ LIMITED
SAMER MUSLEH
CHIEF FINANCIAL OFFICER
+964 780 296 9854
Samer.musleh@zain.com
Bldg. 47, Str. 14,District 605 Hay Al Mutanabi, Al Mansoor, Baghdad, Iraq
www.zain.com

For Inquiries and Comments About IFC, Contact

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2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384

Local Access of Project Documentation

ATHEER TELECOM IRAQ LIMITED

SAMER MUSLEH, CHIEF FINANCIAL OFFICER

+964 780 296 9854

Samer.musleh@zain.com

This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. Its purpose is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

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