Telekom to issue new “round” of bonds: New borrowing of up to EUR 1.2 billion in two years

Telekom Srbija has informed shareholders that an extraordinary shareholders’ meeting has been scheduled for September 5, at noon. The agenda includes, among other things, - the adoption of a decision on the issuance of corporate bonds by Telekom. According to earlier announcements, the state-owned telecom operator plans to borrow another EUR 1.2 billion (USD 1.4 billion) this and next year.

– The issuance of long-term bonds and/or other debt securities by Telekom Srbija a.d. Beograd as an issuer on the international financial market is approved during 2025 and 2026, in a maximum total amount of up to USD 1.2 billion or the equivalent in US dollars, in accordance with the conditions customary in international practice in the type of transactions in question – states the Decision adopted by the Telekom Srbija Assembly at its session on June 27, 2025.

How much of this amount the state-owned telecom operator will borrow this year is unknown to the public, but also to any shareholder of Telekom who does not own at least one million shares of the company, which is a condition for personal participation in the work of the scheduled Shareholders’ Meeting.

Telekom, by the way, has a total of one billion shares, of which 58.1% are owned by the state, 20% are owned by Telekom itself, while the rest are held by small shareholders, of which the largest shareholder owns 90,831 shares (0.00908%).

The announced issue of corporate bonds will be the third in a row. Telekom has already raised money twice by issuing and selling corporate bonds - the first time during the Covid-19 pandemic on the domestic market, and the second time last year - on the international market.

Second issue - on the Dublin Stock Exchange

On October 28, 2024, Telekom issued corporate Eurobonds on the Dublin Stock Exchange in the amount of USD 900,000,000 for five years, according to Telekom’s official financial statements for last year.

– The issue was concluded with an interest rate in dollars of 7% per annum and after hedging the currency risk from dollars to euros, the final interest rate will be around 5.9% per annum in euros. The principal is repaid in full on the maturity date - according to the Notes to the financial statements.

First corporate bonds - for the domestic market

Telekom also issued corporate bonds in 2020 - on September 25, with a total nominal value of RSD 23,500,000,000 for qualified investors. The nominal value of an individual bond is 10,000 dinars with a maturity of five years and a coupon interest rate of 3M Belibor increased by 2.95% per annum. Corporate bonds have a fixed maturity, i.e. the principal is repaid in full on the maturity date.

These were the first corporate bonds of a state-owned telecom operator. The bond buyers were commercial banks in Serbia, from which the securities were then purchased by the NBS.

Profit decline in 2024

Telekom Srbija’s financial reports for 2024 showed that the state-owned telecom operator operated with a profit of 10 billion dinars, but it was two-thirds lower than in 2023. Last year, Telekom spent more than 32 billion dinars on recapitalization of subsidiaries - of that amount, 30.4 billion went to the Arena Channels group. Interest expenses also increased significantly.

Telekom Srbija a.d. Beograd

Telekom Srbija ad Beograd

Telekoma Shareholders Assembly

Telekom issuing corporate bonds