Business & Financial News

Acorn Holdings Repays its KES 5.7 billion Green Bond one month ahead of its official maturity date

By Eunice WAWUDA

Acorn Holdings Limited has announced the early repayment of its Ksh 5.7 billion Green Bond, Africa’s inaugural green housing bond, one month ahead of its official maturity date. It marks a significant milestone in its journey towards sustainable development and economic empowerment.
The company has completed the repayment of the remaining Ksh 2.7 billion, along with accrued interest, well ahead of the official maturity date in November.
Issued in 2020, the Green Bond – the first of its kind in Africa to be cross-listed on both the International Securities Market of the London Stock Exchange and the Nairobi Securities Exchange – has catalyzed the development of green-certified, safe, and affordable student housing across Kenya.
The bond has financed the development of over 7,000 student beds across 8 purpose-built student accommodation properties in Nairobi, including Qwetu and Qejani Chiromo, opening their doors in August with a combined capacity of 2,500 beds. Beyond financing bricks and mortar, Acorn has delivered extensive socioeconomic value.
Commenting on the groundbreaking achievement, Acorn Holdings CEO, Edward Kirathe, remarked: “This is a proud moment that exemplifies Acorn’s core values of innovation, sustainability and empowerment.
The success of this Green Bond has exceeded our expectations. It has not only strengthened our financial position and capital markets presence, but also delivered wide-ranging socioeconomic impact – from affordable student housing and climate-conscious development to job creation, particularly for women-owned enterprises.
We are honoured to have led the way in driving forward a greener, more inclusive vision of growth in Kenya.”
The early redemption demonstrates the company’s strong financial discipline and commitment to investors. Acorn has also proven itself a pioneer in the green bond market, tapping into growing global demand for sustainable fixed income products.
“We set out to prove that business can be a force for good – that profit and purpose can go hand in hand,” said Kirathe. “The success of this bond shows that investing ethically and sustainably is not only possible in Africa, but it is the future. We are immensely proud to be pioneers of that future.”
According to the Capital Markets Authority (CMA) the issuance of the ACORN Green Bond marked a significant turning point in the Kenyan Capital Markets. It demonstrated that well-structured bonds can be a viable financing option, leading to increased confidence among both issuers and investors.
‘The successful issuance of Acorn’s bond showcased the market’s growing maturity and readiness for more sophisticated financial products. The structure of the bond was the first of its kind.
As CMA other than being a regulator we have a mandate to grow the market. The success of this bond paved the way for other entities to consider bonds as a feasible option for raising capital.” CMA, Director of Market Operations Daniel Warutere added.
According to the Nairobi Securities Exchange (NSE) Kenya’s Capital Markets remain a key source of financing for different sectors with the redemption of the ACORN Green bond acting as a testament to the market’s liquidity.
Commenting on the achievement, the NSE Chief Executive Officer, Mr. Frank Mwiti noted,
 “The NSE congratulates Acorn Holdings Limited for the successful redemption of the Acorn Green Bond.
This milestone is a testament to the company’s continued commitment to leveraging the capital markets to finance its growth and development.
The launch and redemption are proof that issuers in Kenya can leverage the green bonds to raise substantial funding to finance projects with environmental and climate benefits. We encourage issuers to explore green bonds as a viable alternative to raise capital.”
The company estimates creating over 5,600 direct jobs and 9,600 indirect jobs as well as influencing the creation of more than 20,000 additional jobs through its developments, with over 80% of construction materials sourced locally.
This has provided a lifeline to small enterprises, especially those women-owned, helping catalyze growth in local economies.
Acorn has also embedded sustainability into its projects, with green building certifications, on-site renewable energy, and tree planting activities. This has reduced the carbon footprint of its student housing while preventing over 1,000 metric tonnes of CO2 emissions annually.
The runaway success has culminated in Acorn achieving multiple global recognitions. These include being named an International Finance Corporation (IFC) IFC EDGE Champion for green development, consistently achieving a 4-star rating in the Global Real Estate Sustainability Benchmark (GRESB) ESG Assessment, and receiving a Green Bond Award from the Climate Bonds Initiative.
“We are grateful to our investors who shared our vision for the future and to our partners for helping turn ambition into reality.
As we build on this success, we remain committed to pushing new boundaries in sustainable, climate-smart development and empowering the next generation with access to quality housing,” Kirathe added.
The bond was guaranteed by GuarantCo which is part of the Private Infrastructure Development Group (PIDG).
“We congratulate the Acorn team on reaching this impressive milestone of the successful redemption of the first ever green bond to be issued in Kenya, and indeed East Africa.
This would not have been possible without the visionary leadership of the Founder & CEO of Acorn Holdings, Edward Kirathe.
His deep sense of caring for his clients, his team and his stakeholders, along with his ability to galvanize a wide pool of investors to buy into the vision must be applauded. We wish Acorn continued success in the future and to maintain our strong relationship.
We also hope to continue to support the broader Kenyan and East African investment community through PIDG’s offerings to deliver infrastructure solutions to the region.” GuarantCo Deputy CEO Surabi Mathur Visser said.
SBG Securities was as the Lead Placement Agent.

 

“We congratulate Acorn on the early redemptions over the life of the Green Bond programme, and we’re delighted to have acted as the Arranger and Lead Placing Agent on this landmark transaction, which set a precedent in project finance via the capital markets.
We are committed to enabling sustainable investments and remain keen on supporting Acorn’s growth journey.”, said Gregory Waweru, Chief Executive Officer, SBG Securities.

 

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