Telefónica refinances loans worth US$635mn

Telefónica de Argentina (NYSE: TAR) has refinanced two loans worth US$635mn and originally secured with controlling company Telefónica Internacional, local newspaper El Cronista reported. TAR managed to renew the loan for six months with an interest rate of Libor plus 5.5%. This amount represents almost 50% of the company's total debt. The operator has used loan refinancing operations since the Argentine crisis in 2001 and 2002 but some shareholders wish the company would refinance debts in the long term, the report said, citing a study by consultancy Argentine Research. To reduce its debt in foreign currency, Telefónica Argentina has issued two series of bonds on the local stock market and requested authorization for a third issue. TAR has now five debentures issued on the local market worth US$700mn and due from 2006-2011.