Telekom Srbija telecommunications company signed an agreement on EUR 470 million worth of loan on Tuesday, and out of this sum, EUR 320 million would be used for the purchase of 20 per cent of shares currently owned by Greek telecommunications company OTE.

According to a release issued by Telekom, EUR 15o million would be set aside for refinancing of the loan for the purchase of Telekom Srpska, and the loan signed on January 9 has a three year maturity date.

The loan worth EUR 470 million was granted by 19 local and international banks, members of the banking groups Credit Agricole, Erste, Eurobank EFG, Komercijalna Banka Beograd Group, Intesa Sanpaolo, Raiffeisen, Societe Generale and UniCredit, as well as Hypo Alpe Adria Bank, OTP, Piraeus and Vojvodjanska Banka in coordination with UniCredit.

The successful realisation of the arrangement points to the trust of the financial market in Serbia's economy and particularly in Telekom Srbija, the release notes. Telekom Srbija and Greek company OTE signed the agreement on purchase of 20 per cent of shares of the Serbian operator on December 30, with the price at EUR 380 million, which would represent OTE's total stake in Telekom Srbija.

According to the release issued at the time, the agreement envisages that the transaction should be completed by the end of the first quarter of 2012.

In keeping with the Telekom Srbija decision on distribution of profit for 2011 which states that shareholders should get 50 per cent of profits, and on the basis of the projections of results at the end of the year, OTE will get EUR 17 million and the Serbian government as the majority shareholder would get EUR 68 million worth of temporary dividend for the fiscal year of 2011.