Kenya raises $2.1 Billion in third Eurobond issue

The Kenyan government has managed to raise $2.1 billion (Ksh 210 billion) of debt from the sale of its third dollar-denominated Eurobond in the European capital markets since 2014.

The issue, which was highly oversubscribed, was split into two tranches of 7-year and 12-year tenors; the 1st issue was a $900 million priced at 7 per cent while the second $1.2 Billion was priced at 8 per cent.

In a statement, the ministry of Treasury said they received bids worth $9.5 billion, representing an oversubscription of about 450 per cent times. The proceeds of the issue will be channeled towards refinancing part or all a $750 million dollar bond that will mature on June 24 while the rest will be used to fund some of the development infrastructure projects and for general budgetary expenditure.

“The issuance of this bond followed extensive engagements and consultations with over 100 investors in the United States of America (Los Angeles, Boston, and New York) and in the United Kingdom (London). The roadshows began on 8^th May 2019 and ended on 14^th May 2019.” the ministry said in a statement.

Kenya’s finances have come under pressure after tax receipts failed to meet forecasts over the last 5 years.

In June 2014, the country launched the debut bond of US dollar 2.0 billion and tapped for a further US dollar 750 million. Early last year, the Government had raised about $2 billion (Sh 200B) in a dollar-denominated Eurobond which was split equally between 10- and 30-year tranches. The issue was oversubscribed by 700 per cent.

Source: Kenyan Wallstreet