DFA rolls over R3.5bn debt

Dark Fibre Africa has outgrown its project finance facilities.

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Dark Fibre Africa (DFA) has entered into a refinance agreement with a syndicate of lenders to provide R3.5 billion in corporate debt facilities.

The refinancing comprises R1 billion of general banking facilities and revolving credit facilities, together with a series of three-, four-, five- and six-year term loans, amounting to R2.2 billion, provided by a syndicate of lenders, it explains.

The syndicate of lenders includes banks, financial institutions and development funding agencies, including Absa, Development Bank of South Africa, Rand Merchant Bank, Futuregrowth Asset Management, Investec Asset Management, the KZN Growth Fund, Liberty Group and Stanlib Asset Management.

"The funds will be used to replace our project finance funding and invest in new infrastructure in order to meet the growing demand for fibre infrastructure across South Africa," explains CFO Thinus Mulder.

DFA owns a carrier-neutral dark fibre infrastructure for the transmission of primarily metro telecommunications traffic. It leases secure transmission and backbone fibre infrastructure to telecommunications operators, Internet service providers, media conglomerates, tertiary education institutions, municipalities, government organisations, and other businesses, large and small, on equal terms.

All its clients have access to the same dark fibre infrastructure with reliability and almost limitless capacity. DFA has already laid more than 7 300km of infrastructure.

"DFA, which was established in 2007, has grown considerably over the years and has now outgrown its project finance facilities," says Mulder. "The refinancing will enable DFA to achieve its main goals of diversifying our providers of debt funding, allow for greater financial flexibility and substantially reduce our financing costs."

Mulder adds demand for fibre-to-the-business (FTTB) has been steadily increasing and funding institutions have recognised this. Several entities are rolling out FTTB, including Vodacom, MTN and Telkom, all of which are in various stages of planning or deployment.