Banks turn down Saudi Telecom bid to solve debt issue: report

Banks have reportedly rejected a plan submitted by Saudi Telecom Co. (STC) to resolve a dispute over a late payment on a $4.75 billion loan at STC’s Turkish unit, Oger Telecom (Otas).

The plan was rejected because it involved taking a loss on the loan, Bloomberg has reported, citing sources familiar with the matter.

Saudi Telecom had reportedly planned to lend Otas $160 million. Oger, which owns 55 percent of Turk Telekom, had failed to make a $290 million repayment in September.

A slump in the Turkish lira led to a decline in the dollar value of dividends Otas receives from Turk Telecom. The company had counted on the dividend payout to repay the loan, it was reported.