Treasury Statement on Kenya's $1.5B Eurobond Transaction

Treasury Statement on Kenya's $1.5B Eurobond Transaction

Kenya has achieved a successful $1.5B Eurobond transaction at 9.75% which is due in 2031. Below is a statement issued by National Treasury and Economic Planning CS Njuguna Ndungu on February 13, 2024, about the same

Kenya's $1.5B Eurobond transaction

The government is pleased to announce the successful pricing of a new 9.75 percent $1.5 billion Eurobond due in 2031. This will amortize in three equal instalments in 2029, 2030 and 2031, resulting in a weighted average life of 6 years. The 2031 Eurobonds have an issue price of 97.270 percent, yielding 10.375 percent.

Kenya received strong demand, with a high-quality order book exceeding $6 billion, allowing for tighter pricing and an increased issuance compared to initial guidance. The proceeds from the 2031 Eurobonds will fund the offer to buy Kenya's existing $2 billion Eurobonds due in 2024, pending demand in the Tender Offer.

Results are expected on February 15, 2024.

The combined transactions are a crucial part of the government's strategy to smoothen the maturity profile of the 2024 Eurobonds and proactively manage debt liabilities. The remaining portion of the 2024 Eurobonds not purchased in the Tender Offer will be funded through a mix of the government funds and financing from multilateral and bilateral sources, including bank syndication.

This diversified financing approach aims to maintain a relatively low weighted average interest rate in the overall public debt portfolio, ensuring Kenya's debt sustainability over the medium term.

International capital markets provide essential liquidity for the government, and the successful transaction underscores investor confidence in Kenya. The government appreciates the strong partnership with investors, committing to sound debt management. Proactively managing debt is a key pillar of President William Ruto's administration, and this transaction represents a significant step toward achieving that goal.

No comments yet. Be the first to comment.

Please log in or register to leave a comment.