Du locks in credit line as undrawn dry powder: State-owned telco Du refinanced its revolving credit facility with a new AED 2 bn, 7-year line led by Emirates NBD and a syndicate of lenders, it said in a bourse filing (pdf). So far, the facility remains undrawn and features improved terms (read: lower standby costs) compared to its previous arrangement.

What this means: Locking in a longer-tenor and cheaper backstop gives Du the flexibility to move on bolt-on acquisitions while insulating its balance sheet from rate and market volatility, the filing read. The telco player has big plans in the works, including for a AED 2 bn hyperscale data center, which is set to see Microsoft as its main tenant and will add to its existing five data centers in the Emirates.

IN CONTEXT- The move comes days after a drone strike hit a Du facility in Fujairah, in what was the first known targeting of UAE telecom infrastructure in the conflict, as well as another hit to the UAE’s digital hub ambitions. Analysts told us earlier this week that a risk premium would be attached to telecom infrastructure due to incoming repair costs.

The incident, albeit minor, extends a pattern of attacks that previously focused on data centers, widening the target set to telecom assets — including Thuraya Telecommunications Company’s administrative building in Sharjah earlier this week.

ADVISORS- Emirates NBD Capital quarterbacked the transaction as coordinator, lead arranger, and bookrunner, with our friends at Mashreq joining as mandated lead arrangers and bookrunners alongside ADCB, Fab, HSBC Middle East, Intesa Sanpaolo, and Standard Chartered. Emirates NBD Bank also acted as agent.

It’s not the only Emirati state-owned firm to access refinancing this week. AD Ports also signed an agreement with First Abu Dhabi Bank and Emirates NBD to refinance USD 2.5 bn in debt ahead of schedule, with the agreement also including an additional accordion option of AED 3 bn. The loan has a tenor of three years, maturing in March 2029.

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