Tower One Wireless Corp. (OTCMKTS:TOWTF) has just inked a long-term debt financing arrangement with Itaú Corpbanca Colombia S.A., and another new local partner in Colombia. The agreement is for an aggregate loan of US$25,000,000.
Itaú will advance 75% of the total loan amount, which is to be secured against Tower One’s newly completed towers (constructed under the financing arrangement). This is to be advanced in two tranches with interest payable by the company to Itaú every three months. The interest is at a rate of 4.615% + Indicador Bancario de Referencia (IBR), in regards to the first tranche. For the second tranche, the interest will be 4.39% + IBR. The loan term extends to 9.5 years.
The remaining 25% of the loan is to be provided by the local partner. The accrued interest thereon is at a rate of 6.2% per annum. Tower One has to repay the principal, along with accrued interest on this loan amount (25% of the total paid by local partner), at the earlier of the company’s election to acquire local partner’s interest in the debt financing arrangement or the company’s disposition of towers, as mentioned above.
Alejandro Ochoa, Tower One Wireless Corp CEO states this financing and partnership enables them to expand on plans to connect Colombia. The proceeds are to be utilized to deploy over 300 towers in the next 12 months. As of now, over 400 towers are in the pipeline!
