Standard Bank Group was the joint lead manager and bookrunner for Kenya’s new $1.5 billion Eurobond. It was also the joint dealer manager for the concurrent tender offer of $1.4 billion outstanding Eurobonds due to mature in June 2024.
The transaction is Kenya’s first since 2021 as the Republic looks to diversify its funding sources and marks a successful return to the capital markets.
The Eurobond, which closed on 16th February, priced at a yield of 10.375% with a 9.75% coupon. It will mature in 2031 and has a six-year weighted average life as the principal will amortise in equal installments in the final three years to maturity. Proceeds of the Eurobond were used to fund the tender offer for the 2024 Notes, which settled on 21st February 2024.
The Eurobond saw strong demand from investors keen to support Kenya’s strategies to proactively manage its debt. This enabled the Republic of Kenya to tighten pricing and upsize the issuance, compared to initial guidance. The tender offer was highly successful with over 72% participation from investors leaving just over $550m bonds outstanding.
Joshua Oigara, Chief Executive of Stanbic Bank in Kenya and South Sudan, a member of Standard Bank Group, said: “We are proud to have facilitated this Eurobond for Kenya. The significant demand we saw for the bond reflects the growing confidence in Kenya from investors. We are enthusiastic about the renewed access to capital markets, the overall success of the transaction and the growth this enables. A deep understanding of Kenya’s economy, regulations and people are at the heart of everything we do at Standard Bank. It is encouraging to see the investor community take note of the opportunity the country represents.”