Melita will be issuing bonds worth tens of millions of euros to fuel the growth experienced by the telecommunications company over the past two years.
The exact value of the bonds will be announced on Monday when they will be officially issued by Melita Capital plc, the company's financial arm.
"What I can say at this stage is that the bonds' terms are quite attractive. We thought it was important to create a good feel in the international community. By issuing them we are encouraging Maltese people to be a part of what is ultimately a growing brand," explained Massimo Prelz, from Melita's majority shareholding company GMT Communications Partners.
The bonds come a month after Melita announced its plans to expand its four areas of services: television, internet, fixed-line and mobile.
As proof of the company's growth, he said, Melita was recently awarded a multi-million euro EU contract to supply the University of Malta with international bandwidth. This will link the University to an academic internet network that connects over 30 million researchers across 34 European countries and other world regions.
"Melita has performed very well compared to our investment portfolio. We are very happy with the results. We expect 2009 to be the best year and 2010 to be better," he said adding that GMT, a European independent private equity group, focused on investments in telecom assets.
Melita Capital, which owns the recently-launched €10 million fibre optic submarine cable linking Malta to Sicily and 30 per cent of Melita Mobile, will be issuing the bonds to finance investment that has gone into the submarine cable and the nationwide 3G mobile communication services.
"After making a substantial investment in the infrastructure and building assets we decided to improve the balance sheets and find long-term financing. Telecom is a very resilient business and attractive to long term investors. I'm confident that there will be enough requests," Mr Prelz said.
Since GMT bought its majority share two years ago, there was a continued increase in the company's internet market share. As for television, there has been a shift to digital, described as positive.
Mr Prelz said that investing in the cable to Sicily was a strategic decision to give better service and also had "positive side effects". It improved connectivity with Europe and put Melita at an advantage to attract large contracts such as the one awarded by EU body Dante (Delivery of Advanced Network Technology to Europe) for the University of Malta.
Such contracts were beneficial for Malta's transformation from industry to a service based economy, he added.
In 2007, GMT acquired a majority shareholding, of 50.75 per cent in a leveraged buy-out valued at €165 million. Later that year, Melita signed an agreement with 3G Telecommunications Limited, a subsidiary of investment firm M/C Venture Partners that holds 35 per cent shareholding. (Gasan Group owns 12 per cent and Blackrock Communications 2.25 per cent shareholding.) This allowed Melita to roll out Malta's first third generation-only mobile network in February.
Throughout these two years the total investment injected into Melita has exceeded €215 million. This included GMT's €165 million spent on purchasing majority shareholding and a recently-concluded €50 million programme to enhance the company's communications network with next generation technology in international connectivity and mobile communication.