All About GP

Introductory page:

 Grameenphone


Grameenphone, widely known as GP is now the leading telecommunications service provider in the country with more than 20 million subscribers as of June 2008. Presently, there are about 30 million telephone users in the country, of which, a little over one million are fixed-phone users and the rest mobile phone subscribers. Starting its operations on March 26, 1997, the Independence Day of Bangladesh, Grameenphone has come a long way. It is a joint venture enterprise between Telenor (62%) and Grameen Telecom Corporation (38%), a non-profit sister concern of the internationally acclaimed micro-credit pioneer Grameen Bank. Over the years, Grameenphone has always been a pioneer in introducing new products and services in the local market. GP was the first company to introduce GSM technology in Bangladesh when it launched its services in March 1997.The technological know-how and managerial expertise of Telenor has been instrumental in setting up such an international standard mobile phone operation in Bangladesh. Being one of the pioneers in developing the GSM service in Europe, Telenor has also helped to transfer this knowledge to the local employees over the years.
The company has so far invested more than BDT 10,700 crore (USD 1.6 billion) to build the network infrastructure since its inception in 1997. It has invested over BDT 3,100 crore (USD 450 million) during the first three quarters of 2007 while BDT 2,100 crore (USD 310 million) was invested in 2006 alone. Grameenphone is also one the largest taxpayers in the country, having contributed nearly BDT 7000 crore in direct and indirect taxes to the Government Exchequer over the years. Of this amount, over BDT 2000 crore was paid in 2006 alone.


Name & address of business:
Grameenphone (Bengali: গ্রামীণফোন), widely known as GP.

GrameenPhone Headquarters Address
Celebration Point Road, 113 A Plot 3 & 5 Gulshan
Dhaka 1212
Bangladesh
Phone: 880 2 988 2990
Fax: 880 2 988 2970
Website: www.grameenphone.com



Grameenphone center Location:
Grameenphone center is found in every district as well as metropolitan cities and local areas, but their main branch is situated in Gulshan. They have also specific office for each department such as specific building for HRM (Human resource management), Accounting, Finance, Marketing etc. People can easily communicate their problem by nearly customer care center.
Complaint Management
Complaint Management handling queries, complain, requests on mails, faxes and letters from customers.
Postal address:
Grameenphone Ltd.
Nitol-Niloy Tower (12th floor).
Plot # 42 & 69.
Nikunjo South C/A, Airport road, Dhaka
FAX: +880-2-9882948 – 51
E-mail: insta.service@grameenphone.com
Web: www.grameenphone.com

Nature of business:
Grameenphone in based on telecommunication service. So they are operating their business which is based on telecommunication business
Though Grameenphone is a telecommunication company they want to give service and speared their telecom network perfectly across the country. Nowadays they are also serving internet service door to door.
1. Executive Summery:

 With more than 20 million subscribers (as of June 2008), Grameenphone is the largest cellular operator in the country. It is a joint venture enterprise between Telenor and Grameen Telecom Corporation, a non-profit sister concern of the internationally acclaimed microfinance organization and community development bank Grameen Bank. Telenor, the largest telecommunications company in Norway, owns 62% shares of grameenphone and Grameen Telecom owns the remaining 38%.
Grameenphone was the first company to introduce GSM technology in Bangladesh). It also established the first 24-hour Call Center to support its subscribers. With the slogan Stay Close, stated goal of Grameenphone is to provide affordable telephony to the entire population of Bangladesh
 The main focus of this research paper was to collect all information about Grameenphone. We worked mainly on primary data but also took the assistance of some secondary sdata.

2. Background:


  Grameenphone Ltd., the largest telecommunications service provider in Bangladesh, received its operating license in November 1996 and started its service from March 26, 1997. Now, after 11 years of successful operations, Grameenphone is the largest mobile phone service provider in Bangladesh, with more than 28 million subscribers as of November 2008.

The idea of providing mobile phone facility to rural areas in Bangladesh was originally conceived by Iqbal Quadir, who is currently the founder and director of the Legatum Center for Development and Entrepreneurship at MIT . He was inspired by the Grameen Bank micro credit model and envisioned a business model where a cell phone can serve as a source of income. After leaving his job as an investment banker in the United States, Quadir traveled back to Bangladesh, after meeting and successfully raising money from a New York based investor and philanthropist Joshua Mailman, and worked for three years gaining support from various organizations including Nobel Peace Prize laureate Muhammad Yunus of Grameen Bank and the Norwegian telephone company, Telenor. He was finally successful in forming a consortium with Telenor and Grameen Bank to establish Grameenphone. Quadir remained a shareholder of Grameenphone until 2004.
Basically Grameenphone is a joint venture enterprise between Telenor (62%), the largest telecommunications service provider in Norway with mobile phone operations in 12 other countries, and Grameen Telecom Corporation (38%), a non-profit sister concern of the internationally acclaimed micro-credit pioneer Grameen Bank.
Over the years, Grameenphone has always been a pioneer in introducing new products and services in the local market. GP was the first company to introduce GSM technology in Bangladesh when it launched its services in March 1997.





Mission & Objective: To provide affordable telephone to the entire population at Bangladesh.


Vision
We are here to HELP .We exist to help our customers get the full benefit of communications services in their daily lives. We want to make it easy for customers to get what they want, when they want it.
Their major values are , we never forget that we are trying to make our customers' lives easier, we want to be a partner in the development of our community , we are about delivery, not over promising - actions not words , We are respectful and professional in regard to all our interactions, both internally and externally.
















4. Products or Service:

Firm’s products and services
Grameenphone serves different types of products and services depending on the categorization of its customer. There are special packages for B2C and B2B customer separately. For B2C customers its services can be categorized into two type of subscription. Those are pre-paid subscription and postpaid subscription. Again prepaid subscription can be subdivided into three plans.
Smile (mobile to mobile connectivity within Bangladesh):
This is the primary package of Grameenphone targeting the economy class segment of the market. The package was designed to suit middle and low income consumer in the market. For instance: Farmer, student, housewives etc. This package features great start up offer to a new subscriber, low call rates, special discount offer entitled as Thank you bonus, special call rate for three friend & family numbers and other facilities.
Smile PSTN (nationwide and international mobile and land line connectivity):
This package also contains the same attributes of Smile but it also has some elaborated leverage of international calls and land line connectivity.
Djuice (a youth based mobile to mobile connectivity within Bangladesh):
Grameenphone launched the brand Djuice in 2005; first ever “Youth” brand in Bangladesh. The main objective of this brand is to serve the youth segment of the market. The product has been specially designed to cater the needs of youths of Bangladesh, both urban and rural. Djuice has various features designed for youths, namely; special rate for Djuice community, Xtra Khatir, (discounts at different outlets).Djuice also arranges different special programs for youth, like, Drockstar (music competition), Know Bangladesh (awareness program).The djuice brand is positioned as the “Youth Brand”. The 3 main features of this brand is Music, Messaging and friends. Recently the brand was refreshed with a new brand message “Break Free”.
And there is only one package under postpaid plan.
Xplore (nationwide and international mobile and landline connectivity):
Xplore is the only postpaid package in the Grameenphone’s product line. It is generally designed to satisfy the needs of a busy person’s life. The person can be an executive, a doctor or in any profession. The message of the package is by gaining the access of unlimited information and entertainment.
Grameenphone Business Solution:
This is a GP service directed to B2B customers of the Grameenphone. Business Solutions is a complete, quality business communications service from Grameenphone – designed especially for the business community in Bangladesh. Grameenphone Business Solutions team is dedicated to provide help B2B customers with customized telecommunications solutions through consultation with them.
Value added services:
Grameenphone also offers different value-added services including SMS, MMS, Welcome Tunes (Ring back Tones), Voice SMS, SMS Push-Pull Service, Voice Mail Service (VMS), and Fax and Data among others. Grameenphone was the first mobile operator in Bangladesh to offer EDGE services to its subscribers.
Achievements:
November 28, 1996: Grameenphone Ltd. received cellular license by the Ministry of Posts and Telecommunications of Bangladesh.
March 26, 1997: Grameenphone launched its service on the Independence Day of Bangladesh.
June 1998: Grameenphone started its services in Chittagong, the second largest city and the port city of Bangladesh. Cell to cell coverage between Dhaka-Chittagong was established.
1999: Grameenphone started its service in Khulna, the industrial city of Bangladesh. Also cell to cell coverage between Dhaka and Khulna brought a number of other districts under coverage.
2000: Grameenphone started its services in Rajshahi, the education city of Bangladesh. Service also started in Sylhet and Barisal and thus all six divisional headquarters got the cellular network coverage for the first time Bangladesh.
August 2003: Grameenphone's subscribes base has become more than one million. Grameenphone became the first operator in the country to reach the million subscribers.
November 2005: Grameenphone registered more than 5 million subscribers.
November 5, 2006: Grameenphone crosses the 10 million subscriber mark after almost ten years of operation.
September 20, 2007: Grameenphone reaches 15 million subscribers mark.
June 2008: Grameenphone reaches 20 million subscribers landmark.
Network Technology:
According to Grameenphone, it has so far invested more than BDT 10,700 crore (USD 1.6 billion) to build the network infrastructure since 1997. It has invested over BDT 3,100 crore (USD 450 million) during the first three quarters of 2007 while BDT 2,100 crore (USD 310 million) was invested in 2006 alone.
Grameenphone has built the largest cellular network in the country with over 10,000 base stations in more than 5700 locations. Presently, nearly 98 percent of the country's population is within the coverage area of the Grameenphone network.
The entire Grameenphone network is also EDGE/GPRS enabled, allowing access to high-speed Internet and data services from anywhere within the coverage area. There are currently nearly 3 million EDGE/GPRS users in the Grameenphone network.
Activate EDGE:

• To subscribe to package 1 (P1), send an SMS to 5000 writing P1
• To subscribe to package 2 (P2), send and SMS to 5000 writing P2.
• To subscribe to package 3 (P3), send an SMS to 5000 writing P3.
Tariff structure
  PACKAGE 1 PACKAGE 2 PACKAGE 3
Subscribers ALL ALL ALL
Monthly Access Fee None BDT 1,000 BDT 300
Browsing Charge BDT 0.02/KB NIL Unlimited from 12am to 8am.BDT 0.02/KB for rest of the time
Content Download As per content As per content As per content

The traffic structure (Djuice)

Offer Peak: 7 am – 12 am Pulse Off-peak: 12 am – 7 am Pulse
djuice-djuice 0.75/min 30 sec 0.25/min 30 sec
djuice-GP 2.00/min 30 sec 0.25/min 30 sec
F&F (2 on-net no) 0.25/min 30 sec 0.25/min 30 sec
djuice-Off-net 2.00/min 30 sec 2.00/min 30 sec

SMS Charge (within 160 characters)
djuice to djuice Taka 0.50 at peak hour,
djuice to GP Taka 0.75 at peak hour,
djuice to other operator Taka 0.75
SMS to port 3030 Taka 1.50
Push Pull subscriptions Taka 2.00
Voice SMS Charge
For sending Voice SMS Taka 2.50/min
For retrieving old messages Taka 1.00/min

*All the tariffs are subject to change
*Vat and conditions applicable


5. The Market
Market structure
Usually the young generation is uniquely different from the other age groups. They usually have lots of friends so frequency of communication through mobile phone is very high. They want to lead a trendy lifestyle and want to try something new. Among the youth there is a considerable number who like to use mobile phone more at night, usually after midnight. They like to move around, enjoy life and chat with friends. Their lifestyles reflect the symbol of youth, who can enjoy life and have a tendency to break free from the traditional views and culture.
Market segments
Djuice segments the market in three main categories. They are
• Demographic segmentation: Demographically Virgin divided the market into three parts. They are
 AGE: Djuice’s target market is young generation people aged between 15 and 25.
 Sex-wise: Djuice does not differentiate sex wise. They are always aiming at both male and female.
 Income: As Djuice s aimed to young generation they assume that their target customers will have limited income and that income will not be high.

• Geographic segmentation: Now they are mainly targeting the urban areas. People who are trendy, young and unique are their target market. In Bangladesh, their majority sales come from the big metropolitan cities and urban areas.

• Psychographic segmentation: Djuice mainly segments the market based on psychographic lifestyle, which means they consider their consumers life style to determine the segment. Djuice is for those, who want to experience something unique and trendy. This sort of nature is mainly found within the young generation who wants to be different among all around them.

Positioning strategies
Positioning of Djuice is mainly focused on trendy-young generation. No other telecom company offers any service package which influences young stars to rock in life, to be a part of something unique, to make them feel having an image of a world of their own. The unique image of “Djuice Dunia” has been successful to get the attention of young users all over the country. It has become like today’s trend to be a member of this “dunia” and young users actually feel proud to be a part of it.
Target Market
Characteristics
Djuice has been launched basically concentrating on the young generation of Bangladesh and the features of this brand are designed keeping the wants and desires of this particular customer group in mind. Both male and female youth from urban areas is targeted, who are from any institutional stage, from school level to undergraduate/graduate level.
Buying pattern
Mobile phone connection is based on single time buying pattern. The availability and cheap cost of Djuice SIM card has made its customers to adopt multiple mobile identity holders whenever they want. In urban areas a recommendable number of Djuice subscribers have more than one Djuice SIM card. The buying decision is mainly a result of influence of friend circle and holding an identity of “Djuice Dania”. There is a point to be noted that no other telecom company in Bangladesh offers such a brand which is concentrated only on the youngsters.
Factors influencing purchase
Friend Circle: Usually teenage group is highly influenced by friends. They try to have the same thing as friends do. And in maximum friend groups, most of the young individuals have Djuice connection which enforces another friend to go for a Djuice connection.
Image: The image of Djuice has been created in such a way that highly influences the young generation. Even the image is set up mentioning the generation “Djuice Generation”.
Promotion: The specially catered promotional policies and the “Djuice Language” such as “Jotil Prem”, “Djuice Dunia” etc has created an appeal amongst the youngsters.
Tariff and Offers: Reduced tariff for certain time of the day, low call rate to dear ones through FnF service, bonus talk time, free bundled SMS, voice SMS, mms are also responsible for Djuice craze amongst teenagers.
Uniqueness: Djuice “Extra Card” was an influencing factor for early Djuice users. This card was given as a discount card or extra facility card at some shopping malls, super shops, restaurants, different service providers etc.
Customer Service: Availability of Djuice (Grameenphone) customer service, recharge card and flexi load services are also another influencing factor.



Further growth
Lots of opportunities still exist for Djuice including span of the market, make better relationships with subscribers etc.

Span of the market: Djuice captured most of the young generation’s eyes. But all are concentrated on urban or metropolitan centric young people. There are a huge number of young people who does not live in the urban areas who are mostly untouched. Djuice can start their activities to capture this segment as well by specially tailored promotional campaigns.
Better relationships with subscribers: It is said that service companies live on their relationship with customers. Djuice can start activities like installing separate “Djuice service centre” to make better relationship with the users. This extra importance can help them to be closer with the users.
CSR: The mother company of Djuice brand is engaged in various CSR activities but the brand itself is engaged comparatively less except for helping in arranging concerts to raise charity, rock band search etc. The relationship with the society can get closer by broadening the horizon of Djuice’s CSR activities.
The competition:
Competitors’ Information
Djuice does not have any direct competitor as no other company has a service solely aimed at younger generation. But if we talk about other mobile service providers then they have strong competition with Banglalink, which is the local company for Egyptian owned Orascom telecom. There are other competitors such as Citycell, Warid Telecom and Government subsidized Teletalk.
Our Competitive Strengths
Unique brand: GP’s Djuice is the only youth brand in Bangladesh. GP is the first to identify and serve this segment in Bangladesh. No other telecom company is till now competing in this market segment with djuice. So to some extent djuice has an absolute advantage in this market segment.
Large market Share: In an overpopulated country like Bangladesh young generation contributes as a large chunk of the overall population. In the Bangladeshi perspective it is huge market and GP is the only firm operating in this segment and djuice has a large market share in this segment. This is a really important achievement for Djuice brand.
Brand reputation: Djuice recently has come up with a new brand message that is “break free”. It is a new effort to refresh the brand. Prior to that Djuice is already popular in the young for the effort for creating a distinct life style. The brand is quite successful in creating a unique community named as Djuice community. It exemplifies the success of the brand.
Product features & promotional tactics: The distinct product feature is very much responsible in attracting the target customer to the brand. The features are craved in such a way that young generation can really make use of it. A large portion of the Djuice promotional effort goes for publicity such as Sponsoring concert, music talent hunt program etc. These tactics are really successful to draw young generation’s attention to the brand.
Commercialization Plan
Our Strategies
Continue to grow our subscriber base
We believe we can continue to grow our subscriber base, while seeking to limit declines in APPM, by increasing the availability of our products and services throughout Bangladesh and by aiming to improve customer retention. We believe that new subscribers will be attracted by our network coverage and our broad offering of services, as well as our service quality and the strength of our brand. In the near term, market conditions have led us to increase the prices of our starter packs and, as a result, we will be focused on higher value customers. In the longer term, we expect to increase our penetration of the growing consumer, rural and financially constrained market sectors. We experienced growth in the consumer, rural and financially constrained market sectors during the year ended December 31, 2008.
Focus on high value customers
We strive to provide superior network coverage, connectivity, quality and reliability, as well as to continue our product and service innovation through continued investment in our network and products. We believe that being an incumbent mobile operator has allowed us to attract early subscribers, whom we believe tend to be more affluent and have greater resources to spend on telecommunications. We intend to continue focusing on this high value customer segment, which we expect will grow as the Bangladesh population becomes more affluent, with our value-added services, in particular Internet access and Blackberry. We also intend to increase our focus on the high value business segment customers, given the high usage of our voice and non-voice services by these customers.
Achieve capital and operational efficiencies to improve profit margins and cash flow generation
We plan to continue to exercise strong discipline over our operating costs and capital expenditures to achieve improved efficiency and productivity in our operations and leverage our existing capacity. Historically, the majority targeted population coverage of more than 95.0% of Bangladesh. Having achieved that target in 2007, we are now focusing our ongoing capital expenditures on expansion of our overall capacity to accommodate increases in subscribers and traffic. In 2008, we moved from a single vendor framework to a dual vendor framework as we entered into a long-term purchase and maintenance agreement for network and radio access equipment with Huawei
Technologies Co. Ltd. (“Huawei”) and we plan to renew our framework agreement for the purchase and maintenance of GSM equipment with Ericsson AB (“Ericsson”). We believe the use of multiple principal suppliers will provide pricing advantages for our future capital expenditures. We have built our own fiber optic network to provide greater redundancy in our network services. We also plan to reduce our operation and maintenance expenses by, among other things, using solar power, controlling service agreement pricing and lobbying to reduce the SIM tax.

Increase brand awareness and reinforce our brand values
We believe we have established ourselves as a quality service provider, the preferred Bangladeshi data service provider, and a national brand that is a partner in developing Bangladesh. We intend to support our brands by undertaking brand refreshment exercises from time to time. In April 2008, we launched the Stay Close Campaign, which helped us to reinforce our branding by emphasizing the importance of staying close to friends and family. We believe the campaign has been successful in increasing brand awareness. For our consumer segment, we have positioned ourselves as being our customers’ lifestyle partner, giving them access to services which enhance their lives. For our business segment, we have positioned ourselves as being our customers’ partner in business, providing efficient and relevant services. For our youth segment, we have the “Djuice” brand, which we support by focusing on text messaging, music, and community service. We also plan to increase brand awareness through various point of sale promotions.
Increase revenue from non-voice services
Our revenues from non-voice services as a percentage of ARPU were 4.2% for the year ended December 31, 2008, which proportion remains low relative to operators in comparable markets in Asia and hence provides scope for non-voice revenue growth. We offer a wide range of non-voice services, including SMS, MMS, games, information services, content download, ring back tones, Internet access and Blackberry services. We plan to TM continue increasing our revenue from non-voice services by actively promoting these services, developing additional services and further expanding our presence as the one of the largest providers of Internet access in Bangladesh.
Continue to expand our comprehensive distribution network
We have adapted our distribution model to the changing telecommunications market in Bangladesh. In the first half of 2008, we implemented a new distribution model. Prior to 2008, we relied on a pull model, whereby our dealers contacted us with product orders. Our new distribution model is to push sales to retailers by distributing our SIM cards, electronic recharge system (“ERS”) and scratch cards through a network of nearly 100 third-party distributors. These distributors distribute our products to retailers, who then sell our products to the public. We have targeted to have approximately 20,000 retailers in our distribution network selling new connections and 110,000 retailers for reloads. Our objectives under the new distribution model are to improve our product availability throughout the country with the establishment of more points of sale, improve inventory management, accelerate distribution of our products, provide better support to our customer base, create a strong channel of communication between us and our subscribers and obtain better market data to allow us to be more dynamic and responsive to the market.
Subscribers
Since 2003 our subscriber base has grown significantly, from approximately 2.4 million subscribers at the end of 2004 to approximately 21.0 million subscribers by December 31, 2008. Consistent with the trend in Bangladesh, most of our subscribers are prepaid subscribers, who represent an increasing proportion of our subscriber base. Compared to postpaid subscribers, our prepaid subscribers have historically been characterized by little to no customer service costs and relatively lower access charges, and have provided us with a cash flow advantage because all payments are made prior to services being provided.
Marketing and Brand Recognition
We believe that we have one of the strongest brand images in the Bangladesh telecommunications sector. We also aim to keep the Grameenphone and Djuice brands amongst the strongest brands in Bangladesh in terms of brand recognition, enjoying high spontaneous as well as prompted positive brand awareness among the Bangladeshi population; both represent a valuable asset to us. We launched a new logo in November 2006 known as the “Telenor device”, which we accompany with the name “grameenphone.” We believe the new logo and related visuals express values we strive for, such as trust, reliability, quality and constant progress, and signal our continued focus on securing the best possible communications services for our subscribers. Our logo is visible on our sales and service centers, franchises, retail outlets, billboards, electronic media and on our website. See “—Intellectual Property.”
Our Advertising
We have engaged in high profile advertising campaigns in order to promote our products and services nationally and to increase our brand recognition. We utilize a wide range of media for our advertising in order to reach the mass market: electronic media (nationwide television and radio advertisements), print media (advertisements in newspapers, magazines and periodicals) and outdoor advertising (billboards, shop fascias and point-of-sale materials). We also advertise our products and services via our website and target our existing subscribers through direct advertising, including postpaid bill inserts and SMS advertisements.
In addition to our advertising campaigns, we also sponsor a wide range of charitable causes and community events throughout Bangladesh in order to position our brand name and promote our products and services, such as our sponsorship of the Bangladesh National Cricket Team and our sponsorship of the Bangladesh team for the 2007 Special Olympics World Summer Games.
For the year ended December 31, 2007, our expenditure on advertising totaled Taka 1,051.7 million. For the year ended December 31, 2008, we spent Taka 864.6 million on advertising.
Our Marketing Initiatives
We position ourselves as a caring company, helping people stay close to friends and family while improving their access to their interests. In this vein, our new campaign “Stay Close” was launched in April 2008, which helped us to reinforce our brand position by emphasizing the importance of staying close to friends and family. We believe it has been successful in increasing brand awareness. The campaign had full media coverage, comprising television, radio, outdoor-overheads, press, cinemas and posters.
We also look to enrich the lives of our countrymen. Our award winning service Health Line gives people easy access to medical services. Our CICs bring the internet to our rural areas. Our focus on continuously creating value for subscribers has given us the reputation as a leading innovative value-added services provider.
Based on information from sources such as the Bangladesh Bureau of Statistics, the World Bank, the
National Media Survey by AC Nielsen and analysis of our internal call data records, we have developed a comprehensive market segmentation model for the mobile telecommunications market in Bangladesh. We target each market with a specific set of products and corresponding marketing mix.
There are four market segments, namely “Consumer,” “Business,” “Youth,” and “Emerging.”
The “Consumer” segment consists of people above the age of 29 and includes professionals, homemakers, and the general population. Products targeted toward this segment are the “smile prepaid” and “xplore postpaid” packages. The “Business” segment is made up of businesses that pay the subscriptions for their employees. This segment is exclusively catered to with the “Business Solutions” packages.
The “Youth” segment consists of people within the age group 18-29. They exercise significant buying power, both for themselves and in the context of their family purchasing decisions. They are often the “early adopters” for any newly introduced product or feature. “Djuice” prepaid packages are sold specifically to this market.
The “Emerging” segment is alternatively referred to as the “financially constrained” group. Households with monthly incomes ranging between Taka 2,500 and Taka 6,000 fall into this segment, and it is assumed that one financially constrained household has the purchasing power for one subscription. As the Emerging segment mostly uses shared phones, we count shared phone users as part of our Emerging market. Hence, we target this segment with our “Grameenphone Public Phone” and “Village Phone” products.
Sales and Distribution
We sell our products and services to subscribers through an indirect channel consisting of exclusive third- party distributors, who deliver our products to retailers who then sell them to the public, and exclusive branded franchises, as well as through a direct channel comprised of Grameenphone Centers and a dedicated “Direct Sales
Force” focused on the corporate sector and the business market, including small- and medium-sized enterprises. We estimate that a substantial majority of the new subscribers added during the year ended December 31, 2008, were acquired through indirect channels.
Our prepaid services are sold both indirectly through a network of third-party non-exclusive retailers—more than 14,000 retail outlets sell SIM card kits and reload cards nationwide and over 95,000 points of presence sell SIM card top-ups only—and directly through Grameenphone Centers and Grameenphone service desks. We expect the number of third-party non-exclusive retailers offering our products to increase to more than 130,000 by the end of
2009. Many of these third-party retail outlets are located in high visibility, high-traffic areas and are provided with specially designed Grameenphone shop fascia and branded point-of-sale products to help consumers in identifying these outlets. We also provide trade marketing assistance to third-party retailers.
We implemented a new distribution model in 2008, whereby we have divided the country into nearly 100 business operating areas, depending on the geography and business volume. For each area, we have assigned an exclusive distributor to ensure direct delivery of products to our channel partners, which include our third-party distributors and registered retailers. Our new model is designed to allow us greater efficiency, flexibility and speed in delivering our products, as we aim to achieve a maximum delivery time of three days per week. We developed a distribution manual to be followed by the distributors, with our audit team conducting periodic reviews to ensure their compliance. Our distribution contracts grant exclusivity for one year, subject to annual renewal, and the distributor agrees to exclusivity with us in respect of the telecommunications industry. One sales employee known as our “distribution operations manager” is assigned to each distributor to assist the distributor and to ensure compliance with our guidelines, to review the distributor’s performance, to help manage stock and order control, and to ensure retailers are satisfied with their distributors.
Under our distribution model, we deliver our SIM cards, scratch cards, ERS and other products to distributors, who in turn place the products with retailers. Customers then purchase and activate the SIM cards, ERS or scratch cards.
Retail Channel
All third-party non-exclusive retail outlets (14,000 outlets for SIM and reload services; and 95,000 outlets for only reload services) are regularly visited by our territory officers, who are our full time employees. We invest in a retail point based on its contribution to our business and we develop those outlets that have business potential. We provide our product and service knowledge development support to our retailers, as well as campaign and merchandising material.
In addition to third-party retail, our 18 directly-owned Grameenphone Centers provide a direct channel to customers and offer our whole portfolio of products. Our flagship Grameenphone Centers provide a “one-stop solution” for our customers. Our sales and service staff provide assistance with postpaid SIM replacement, reconnections, migrations, billing, product information, refunds, ownership transfer, complaints and queries, password unblocks, SIM checks, technical problems, international roaming, welcome tunes configuration, Voice SMS, voice mail, and EDGE-related services.
Another aspect of our indirect distribution network is our nationwide franchise network. We were one of the first mobile operators to introduce a franchising concept into the mobile sector in Bangladesh, and we currently have 54 exclusive franchisees operating Grameenphone Centers. Both our prepaid and our postpaid services are sold through these franchisees, focusing on private subscribers in major cities as well as certain more remote locations. Each franchisee is equipped to process sales, collect bills and offer other customer services. All franchisees have Grameenphone-trained sales and service staff. Under the franchise agreements, the franchisee is given a license to sell our products and services, using our trade name and trademark, in a location selected by us.
The franchisee must sell our products and services exclusively. In return, we pay them a commission, as set and amended by us from time to time. We also provide them with our products and services, such as handsets, SIM cards and subscription forms, organize training for their sales force, and provide support services, as well as merchandising and marketing support.
Direct Sales to the Business Market
A dedicated sales team provides our Business Solutions subscribers with customized telecommunications solutions through consultation. We had nearly 150 employees as of December 31 who was responsible for sales and related activities and after-sales support aimed at our corporate customers. As of December 31, 2008, we had more than 391,500 subscribers to our Business Solutions service. Our direct sales team is focused on high revenue subscribers (rather than high numbers of subscribers), as well as customer quality, service quality, up sales and cross sales. We target the small business market through our indirect sales channels rather than our direct sales force.
Sales and Distribution Organization
To manage our sales activities, we have divided the country into nine regions, 48 areas and 268 territories.
Each of these groupings is led and managed by a regional head, an area manager and a territory officer, respectively.
We have over 1,380 full time and 130 contract sales employees as of December 31, 2008, who is responsible for sales and marketing activities. In line with our new distribution model, we restructured our sales division in 2008. As part of the restructuring, we decentralized some functions, introduced information technology tools to increase operational efficiencies, and consolidated some divisions. We also intend to move all our contract sales employees into full-time positions. We give incentive our frontline sales staff with variable salaries rather than commissions. Salaries are adjusted based on a sales staff member meeting quarterly targets set by our management.
Revenue contribution
Prepaid Services—smile and djuice
As of December 31, 2008, we had approximately 20.6 million prepaid subscribers, representing approximately 98.2% of our total subscriber base. We derive a majority of our mobile telecommunications service revenue from our prepaid mobile services. Since 2007, we have marketed our prepaid services under the “smile” brand and the “djuice” youth brand. Prepaid subscribers do not pay subscription or other monthly charges.
Our prepaid services made up 89.1% of our revenue for 2008.
A party becomes a prepaid subscriber by purchasing a starter pack that includes a SIM card with an initial credit balance. As of December 31, 2008, starter packs for “smile” cost Taka 500. In April 2009, the price was revised and currently a starter pack for “smile” costs Taka 900 with Taka 20 of initial credit. Prepaid subscribers to “smile” can subsequently top-up their credit balance either by using FlexiLoad, our electronic recharge system or ERS, or by purchasing scratch cards (which are refill vouchers). A credit top-up of Taka 10to Taka 299expires after 30 days (for both incoming and outgoing service), while a credit top-up of Taka 300 to Taka 5,000 expires after 365 days (for both incoming and outgoing service) with which we include seven additional free days for incoming service. We offer a variety of promotional packages, such as discounted tariffs for off-peak hours or for calls to certain designated parties. Our “smile” subscribers may purchase scratch cards at Grameenphone Centers, Grameenphone service desks and at many independent retailers. The “djuice” brand is our youth brand for prepaid mobile to mobile services. A party becomes a Djuice subscriber by purchasing a start-up pack, which includes a SIM card with an initial credit balance and a number of free SMS with other djuice subscribers. As of December 31, 2008, a djuice start-up pack cost Taka 500 and included Taka 20 of bonus talk time and 200 free SMS with other djuice subscribers. After a price revision in April 2009, a djuice starter pack currently costs Taka 900 with an initial credit of Taka 20 and 200 free SMS with other Djuice subscribers. Djuice subscribers can also enjoy the same refill benefits as “smile” subscribers. Each start-up pack includes a SIM card with an initial credit balance of Taka 20 and 200 free SMS with other djuice subscribers. A credit top-up of Taka 10 to Taka 299 expires after 30 days (for both incoming and outgoing service), while a credit top-up of Taka 300 to Taka 10,000 expires after 365 days (for both incoming and outgoing service) with which we include seven additional free days for incoming service. In additional to basic cellular options, djuice subscribers can have an “xtra” card, that gives the holder the opportunity to receive discounts or benefits, including in food shops, cafés, clothing stores, and CD and DVD stores. Djuice subscribers may purchase scratch cards at Grameenphone Centers, Grameenphone service desks as well as our exclusive retailers.
Risk analysis
Weaknesses

Criticism: Some people think that Djuice is a brand directed to the unproductive segment of the population. It creates an extra burden on the parents. Some of the product features of Djuice such as a very low call rate from 12.00 am 7.00 am created question about the moral validity.
Ineffective pricing: it is huge setback for djuice as its call rate for djuice-GP (2tk/min) is higher than normal GP-GP call rate (1.5tk/min).
Threats

There are also threats along with opportunities in the market.
Potential competitors: Telecom industry is not much saturated yet but the competitors like Aktel, Banglalink, and Warid are always coming with their new attractive offers. As djuice is the only youth centric brand, other telecom companies might target them as well. This is really a big challenge for even a brand like Djuice to keep on a consistent track of success.
Image: Djuice’s all promotions are based on “rock” life style which is very much welcomed at the young generation but most of the times hated at the parents level. This can have significant negative consequences as most of the Bangladeshi youth’s buying choice is usually directed by the parents.
Ongoing political instability: There has been a political instability going on in Bangladesh for the past few years. As all service companies rely on their offers and treatment of the clients, the current political situation might hamper Grameenphone’s service activities in a way that the subscribers may not get well treated sometimes. For an example, a shortage of “Credit Recharge Card” may occur during long term strike.

Financial Information
Grameenphone is not only committed to its customer but also to its shareholders. They always try to provide handsome amount of money as a dividend to its share holder. Although 2007 was not a good year for the GP, they still gave BDT 26.66 dividend per share which is higher than of any other previous year. Their net profit to turnover ratio decreased from 16% in 2006 to 6% in 2007. It was mainly due to the fact that they had to compensate BDT 168, 42, 43 K to BTRC for illegal business concern, which directly affected not only the Net profit to turnover ratio but also Earnings per share which decreased from 132.41 to 54.14 from the previous year .On the other hand, Return on total asset decreased from 27 % to 18 % for the fact that they invested BDT 81,60,99,87 K on property, plant and equipment, network. This amount was 1.5 times higher than of previous year. However their dividend payout ratio increased from 19% to 49% which is good sign for the investors. In 2007 their revenue was BDT 54,303,146 K.


SELECTED RATIOS AND EARNINGS PER SHARE
For the nine months
Ended September 30, for the years ended December 31,
2008 2007 2006 2005 2004 2003
Liquidity ratios
Current ratio 0.20 0.19 0.44 0.42 0.72 1.16
Quick (Acid Test) ratio 0.19 0.16 0.40 0.40 0.69 1.15
Times interest earned ratio 5.61 15.27 19.52 16.88 N/A N/A
Debt to equity 0.73 0.63 0.32 0.50 0.16 0.31
Operating ratios
Average collection period (days)/accounts
Receivable (days) 15 23 32 40 47 52

Inventory turnover 1.2 1.0 1.7 3.1 2.2 3.2
Total asset turnover 0.7 0.7 0.8 0.8 0.9 0.8
Profitability ratios
Gross profit margin 47.1% 55.1% 59.1% 58.6% 61.1% 62.8%
Operating profit margin 21.9% 30.0% 39.9% 42.8% 51.1% 54.6%
Net profit margin (NPAT margin) 0.9% 5.6% 16.4% 23.5% 34.4% 34.5%
Return on equity 2.0% 12.1% 35.0% 43.6% 62.9% 63.9%
Return on total asset (ROA) 0.6% 3.9% 12.9% 18.1% 30.5% 28.3%
Earnings per share (Taka) 0.03 54.14 132.41 122.31 122.61 84.01
Adjusted earnings per share (Taka) 0.03 0.25 0.62 0.57 0.57 0.39
 (1) Cost of goods sold refers to cost of SIM cards, scratch cards and handsets. Cost of goods sold annualized for calculating the ratio for the nine months ended September 30, 2008.
(2) Total Revenue annualized for calculating the ratio for the nine months ended September 30, 2008.
(3) Net profit after taxes annualized for calculating the ratio for the nine months ended September 30, 2008.
(4) For the years ended December 31, 2003, 2004, 2005, 2006 and 2007, the weighted average shares is adjusted for a par value of Taka
1.00 Per share, which was the par value per share of our ordinary shares after the 43:1share split and the issuance of bonus shares that we completed in July2008? See “Description of Securities Outstanding or Being Offered — Share Capital.” It does not reflect our 10 for 1 reverse share split and related issuance of 250 bonus shares, which we completed in July 2009. See “Summary—Recent
Developments—Reverse Share Split.” For our earnings per share adjusted on a pro forma basis for a par value per share of Taka 10.00 per share (which is the par value of our shares prior to the closing of the Offering), see “Appendix D(IV) — Pro Forma Statements.”
Ratio Formula
Liquidity Ratios
Current Ratio: Current Assets / Current Liabilities
Quick (Acid Test) Ratio: (Current Assets-Inventory) /
Current Liabilities
Debt to Equity: Total Debt / Total Equity
Times Interest earned Ratio: EBIT / Net Finance Cost
Operating Ratios
Average Collection: Period (Days) /
Average Accounts Receivable / Revenue per Day
Accounts Receivable (Days)
Inventory Turnover:
Cost of Goods Sold / Average Inventory
Total Asset Turnover:
Total Revenue / Average Total Assets
Profitability Ratios
Gross Profit Margin: Gross Profit / Total Revenue
Operating Profit Margin: Operating Profit/Total Revenue
Net Profit Margin: (NPAT Margin) Net Profit after Tax / Total Revenue
Return on Equity: NPAT / Average Shareholders’ Equity
Return on Total Asset (ROA): Net Profit After Tax / Average Total Assets
Earnings per Share: NPAT / Weighted Average Shares Outstanding
Source: Grameenphone prospectus
Budget determination

The company did not provide us with the exact amount of their promotional budget, but we were given some hints. Grameenphone basically uses a top-down approach where their budget is usually set in top management and then passed to the managers. To some extent Grameenphone determines their marketing budget by looking at the movements of their competitors. They also think that marketing budget is like an investment as their customers get attracted to them through their marketing activities. In 2007, Grameenphone spent approximately Tk.1 billion for all their promotional activities and from this 25% to 30% was allocated for Djuice. According to their company marketing policy Djuice always put emphasis on newspaper ads. Normally they put their ads on 3rd page or middle pages. But sometimes if they want more exposure they put their ads on front page or a full page ad on 2nd page. For newspaper ads with more importance they usually spend Tk 250,000-300,000 and for regular newspaper ads they spend Tk. 40,000-50,000. After newspaper, Djuice gives equal importance to billboards and television ads. For each billboard at a prime location they spend more or less Tk. 400,000. Their budget for making of a normal 30sec TV ad is approximately Tk. 2 million. For airing these ads all day they spend usually Tk. 10,000 for showing it each time at normal time. But if they want to telecast the ad before news or during festivals then they spend Tk. 30,000-40,000 for each time. Recently FM radio channels have gained tremendous popularity among the youth generation, so they are putting on their ads on radio channels too. If we summarize their budgeting then we shall see that they allocate 50% of their promotional budget for newspaper ads, 30% for TV ads, 10% for billboards, 5% for radio and 5% for others which include posters, festoons, banners etc.


Figure: Budget allocation for different medias
Loan Taken By or Given to Issuer To or From the Holding or Parent Company
Short-Term Working Capital Facilities
As of September 30, 2008, we were party to short-term working capital facilities with 19 banks operating in Bangladesh and had entered into short-term loans with four financial institutions. The aggregate amount available under these facilities and loans is Taka 22,922.85 million. The aggregate non-funded limit under these facilities is Taka 19,622.2 million, which includes letters of credit, letters of guarantees and foreign exchange forward arrangements. The aggregate funded limit under these facilities is Taka 10,790.65 million, which includes overdraft facilities, short-term loans and import loans. The applicable interest rate on the funded working capital facilities varies from bank to bank between 11.0% and 15.0% per annum, subject to revision by the banks. The applicable interest rate on the short-term loans with the four financial institutions is 17.0% per annum.
The following summarizes our existing short-term working capital facilities and short-term loans as of September 30, 2008: Bank Alfalah. The facility with Bank Alfalah Ltd. includes a cash finance facility for up to Taka 225 million, with an interest rate of 14.0% per annum, a letter of credit for Taka 525 million, and a bank guarantee for Taka 300 million, all valid until July 2009.
Bank Asia Ltd. The facility with Bank Asia Ltd. includes an overdraft facility for up to Taka 270 million, with an interest rate of 13.5% per annum, and a letter of credit for Taka 280 million, all valid until April 2009.
BRAC Bank Ltd. The facility with BRAC Bank Ltd. includes a short-term loan facility and overdraft facility under which the combined exposure must not exceed Taka 550 million and each with an interest rate of 14.0% per annum, and a letter of credit for Taka 1,300 million, all valid until August 2009.
Citibank N.A. The facility with Citibank N.A. includes a short-term loan facility and an overdraft facility, under which the combined exposure must not exceed Taka 2,100 million, with an interest rate of 11.75% and 12.0% per annum, respectively. It also includes a letter of credit for Taka 2,800 million.
The Citibank N.A. facility is considered renewed yearly unless otherwise decided by the bank. Commercial Bank of Ceylon Ltd. The facility with Commercial Bank of Ceylon Ltd. included a short- term loan and overdraft facility of up to Taka 210 million, with an interest rate of 12.5% per annum, a letter of credit for Taka 550 million and foreign exchange forward arrangements for up to Taka 550 million, all valid until June 2008. We are in the process of renewing this facility.
Dhaka Bank Ltd. The facility with Dhaka Bank Ltd. includes a short-term loan and revolving loan against trust receipt facility for up to Taka 435 million, with an interest rate of 14.0% per annum, and a letter of credit with shipping guarantee for Taka 1,000 million. The short-term loan and revolving loan against trust receipt facility is valid until April 2009 and the letter of credit with shipping guarantee is valid until March 2009.
Dutch Bangla Bank Ltd. The facility with Dutch Bangla Bank Ltd. includes a revolving short-term loan, overdraft and loan against trust receipt facility for up to Taka 390 million, with an interest rate of
13.5% per annum, and a letter of credit for Taka 930 million, all valid until April 2009. Eastern Bank Ltd. The facility with Eastern Bank Ltd. includes a short-term loan facility for up to Taka 600 million, with an interest rate of 13.75%, an overdraft facility for up to Taka 100 million, with an interest rate of 13.75% per annum, a loan against trust receipt facility for Taka 600 million, a letter of credit for Taka 1,400 million and bank guarantees for Taka 150 million each, all valid until June 2009.
The combined funded exposure under the short-term loan facility, loan against trust receipt facility and the overdraft facility must not exceed Taka 600 million, and the total exposure under the bank guarantees must not exceed Taka 150 million.
Export Import Bank of Bangladesh Ltd. The facility with the Export Import Bank of Bangladesh Ltd. includes a bai-muajjal (a credit sale on a deferred payment basis) of Taka 225 million, with a profit of 14.0% per annum, and a letter of credit for Taka 300 million, all valid until June 2009.
IDLC Ltd. On July 14, 2008, we entered into a Taka 200 million term loan with IDLC Ltd. The loan is fully drawn. The principal is to be repaid in October 2009, and interest of 17.0% per annum is payable every quarter.
Jamuna Bank Ltd. The facility with Jamuna Bank Ltd. includes a letter of trust receipt and overdraft facility for Taka 230 million, with an interest rate of 14.5% per annum, and a letter of credit with a shipping guarantee for Taka 580 million, all valid until January 2009.
National Housing Finance and Investments Ltd. On July 28, 2008, we entered into a Taka 150 million term loan with National Housing Finance and Investments Ltd. The loanis fully drawn. The principal is to be repaid in July 2009, and interest of 17.0% per annum is payable every month.
One Bank Ltd. The facility with One Bank Ltd. includes an overdraft facility, loan against trust receipt facility and time loan facility, all revolving, under which the combined exposure must not exceed Taka 280 million, with an interest rate of 13.5% per annum, a letter of credit for Taka 660 million and a bank guarantee for up to Taka 10 million, all valid until October 2008. We are in the process of renewing the One Bank Ltd. facility. As of the date of this Prospectus, this facility was fully repaid, and we are in negotiations to renew this facility.
Premier Bank Ltd. The facility with Premier Bank Ltd. includes an overdraft facility for
Taka 390 million, with an interest rate of 13.5% per annum, a letter of credit for Taka 910 million and a bank guarantee for Taka 910 million, all valid until March 2009. The exposure under the letter of credit and guarantee must not exceed Taka 910 million.
Prime Bank Ltd. The facility with Prime Bank Ltd. includes an overdraft and loan against trust receipt facility Taka 950 million, with an interest rate of 14.0% per annum for the first Taka 600 million and 15.0% for the remaining Taka 350 million, and a letter of credit with a shipping guarantee for Taka 1,500 million, all valid until August 2009.
Shahjalal Islami Bank Ltd. The facility with Shahjalal Islami Bank Ltd. includes a murabaha letter of credit (where an intermediary buys the required item and sells it to the prospective buyer) for Taka 980 million, with a profit of 14.0% per annum, a revolving murabaha post import trust receipt and bai-muajjal trust receipt facility for Taka 430 million, with a profit of 14.0% per annum, and a bank guarantee for Taka 100 million, all valid until December 2008.
Standard Chartered Bank. The facility with Standard Chartered Bank includes a short-term loan and overdraft facility under which the combined exposure must not exceed Taka 950 million, each with an interest rate of 13.5% per annum, and letters of credit with a shipping guarantee for a total of Taka 2,333 million, all valid until July 2009.
The City Bank Ltd. The facility with The City Bank Ltd. includes an overdraft facility and short-term loan facility, under which the combined exposure must not exceed Taka 370 million, with an interest rate of 13.25% per annum and 13.5% per annum, respectively, a letter of credit for Taka 590 million and a bank guarantee for Taka 590 million, all valid until December 2008.
The Hongkong and Shanghai Banking Corporation Limited, Dhaka. The facility with The Hongkong and Shanghai Banking Corporation Limited, Dhaka, includes a short-term loan facility for up to Taka 700 million, with a floating interest rate to be fixed at the time of drawing, an overdraft facility for up to Taka 150 million, with an interest rate of 12.5% per annum, a letter of credit for Taka 2,300 million, and a foreign exchange line for Taka 10 million, all valid until June 2009.
The combined funded exposure under the short term loan and overdraft facility must not exceed Taka 700 million.
Trust Bank. The facility with Trust Bank includes an overdraft facility for up to Taka 280 million, with an interest rate of 13.5% per annum, and a letter of credit for Taka 400 million, all valid until December 2008.
United Leasing Company Ltd. On July 8, 2008, we entered into a Taka 150 million term loan with United Leasing Company Ltd. The loan is fully drawn. The principal is to be repaid in July 2009, and interest of 17.0% per annum is payable every month.
Uttara Finance and Investments Ltd. On June 26, 2008, we entered into a Taka 500 million term loan with Uttara Finance and Investments Ltd. The loan is fully drawn. The principal is to be repaid in December 2008, and interest of 17.0% per annum is payable every month.
Woori Bank. The facility with Woori Bank includes a revolving overdraft facility for up to Taka 205.65 million, with an interest rate of 11.0% per annum, and a letter of credit for Taka 274.2 million, all valid until January 2009.
The facilities with Shahjalal Islami Bank Ltd. and the Export Import Bank of Bangladesh Ltd. require compliance with certain Islamic principles. No overdraft facility is allowed, and all borrowing must be earmarked against specific purchases. Also, the monies from that facility cannot be used to make payments to regulatory authorities.
Long-Term Borrowings
On September 17, 2007, we entered into a Taka 2,000 million syndicated term loan facility with 16 banks operating in Bangladesh: Agrani Bank, Bank Asia Limited, Citibank N.A., Infrastructure Development Company Limited, IFIC Bank Limited, Jamuna Bank Limited, National Bank Limited, Pubali Bank Limited, Saud-Bangladesh Industrial & Agricultural Investment Company Limited, Standard Bank Limited, Standard Chartered Bank, The City Bank Limited, Trust Bank Limited, United Commercial Bank Limited, Uttara Bank Limited and Sonali Bank. The loan is fully drawn. The principal is to be repaid in 17 equal quarterly installments beginning on November 15, 2008, with the balance due on October 15, 2012. Interest of 13.50% per annum is payable quarterly.
We have term loan facilities with International Finance Corporation (“IFC”), the Asian Development Bank (“ADB”) and the Norwegian Investment Fund for Developing Countries (“NORFUND”), for principal amounts of US$30.0 million, US$20.0 million and US$10.0 million, respectively. Each loan is fully drawn. The principal of each term loan is to be repaid in 10 equal semi-annual installments beginning on December 15, 2005, with the balance due on June 15, 2010. Each loan has a variable interest rate linked to our net debt to EBITDA ratio. If the ratio is equal to or more than 1.0, the interest rate is LIBOR plus 3.5% per annum; if the ratio is less than 1.0 and equal to or more than 0.5, the interest rate is LIBOR plus 3.25% per annum; and if the ratio is less than 0.5, the interest rate is LIBOR plus 3.0% per annum. Interest is payable everyJune 15 or December 15 during the term of the loans. We used these term loans for the expansion of our cellular network and to refinance existing debt.

 As per the loan agreement, we can apply the amounts borrowed under the agreement towards general corporate purposes, including expanding the network capacity and capital expenditure. The term loan with ADB requires us to abide by ADB’s anticorruption policy at all times.
We are party to a NOK 25.0 million term loan facility with Eksportfinans. The loan is fully drawn. The principal is to be repaid in 14 equal semi-annual installments beginning on June 29, 2004, with the balance due on December 29, 2010. The interest rate is payable at six months NIBOR plus 30 basis points per annum. Interest is payable every June 29 or December 29 during the term of the loan.
We are party to a NOK 50.0 million term loan facility with NORAD, an external directorate under the Royal Norwegian Ministry of Foreign Affairs. The loan is fully drawn. The principal is to be repaid in 14 equal semi-annual installments beginning on June 30, 2004, with the balance due on December 31, 2010. Interest is payable at a fixed rate of 3.4% per annum, payable every June 30 and December 30 during the term of the loan.