Kenya borrows Sh210 billion in new Eurobond
SEE ALSO :Kenya’s borrowing costly, experts warnKenya, which made its debut in international capital market in the summer of 2014, issued 10- and 5-year tranches that were met by huge investor appetite. Early last year, it returned for 10- and 30-year tranches bond. The seven-year portion of the latest issue was priced at 7.0%, while the longer-dated tranche was priced at 8.0%, well below the initial guidance price of 7.5% and 8.5% respectively, the ministry said. CS Rotich said that he was overwhelmed by investor interest if lending to Kenya after cumulatively putting Sh950 billion on the table, an amount that is nearly five times what he needed. The government received bids worth $9.5 billion for the Eurobond from investors, an oversubscription of 4.5 times, the ministry said in the statement from London. The proceeds will be used to fund infrastructure projects, general budgetary spending and refinance part or all of a $750 million dollar (Sh75b) bond that will mature on June 24, the ministry said.
SEE ALSO :Eurobond money 'earned, but no project'Both tenors of the new bond will be amortized at $300 million (Sh30b) and $400 million (Sh40b) respectively for the 7- and 12-year tenors annually in the last three years to maturity in order to avoid a surge in repayments, the Treasury said in the statement.