October 13, 2014, 15:45 / Finance

Megafon agreed with China Development Bank on financing for $500 million

Megafon OJSC issued a mandate to the State Development Bank of China (China Development Bank) to organize financing in the amount of $500 million. The corresponding agreement was signed on Monday by Megafon CEO Ivan Tavrin and the head of the bank’s board of directors, Hu Huaibang, an Interfax correspondent reported from the signing ceremony .

The signing took place on Monday as part of a meeting between the heads of government of Russia and China, Dmitry Medvedev and Li Keqiang.

“The China Development Bank financing will be used to purchase equipment and services from Huawei for the development of Megafon’s mobile network,” operator representative Olesya Yaremenko told Interfax. “ Megafon ” traditionally receives loans from the China Development Bank to finance the purchase of Huawei equipment. In 2007 The Russian operator raised $85 million from a Chinese bank, in 2009 - $300 million, in 2011 - $500 million. In total, since 2001, China Development Bank acted as the organizer of 7 credit lines for Megafon.

According to data from the middle of this year, Huawei's share in equipment supplies to Megafon is 21%. In June, the operator signed a seven-year contract worth several tens of billions of rubles with Huawei for the supply of equipment for the construction and modernization of 2G, 3G and LTE networks.