East African Breweries Limited floated KSh 11 billion corporate bond early this month but the medium-term notes were oversubscribed by 245%
Capital Markets Authority says this is the single largest non-infrastructure corporate bond and commercial papers offer ever floated in the Kenyan market
The funds will be used to finance investments in expanding production and repaying debts taken in the ordinary course of business refinance short-term borrowings
East African Breweries Limited (EABL) has said the KSh 11 billion corporate bond it floated early this month, was oversubscribed by 245% to hit KSh 37.9 billion. EABL raises Kenya’s single largest non-infrastructure corporate bond. In a statement seen by TUKO.co.ke , the company said the funds will be used to finance investments in expanding production, repaying debts taken in the ordinary course of business refinance short-term borrowings and to provide working capital.
The issue is the single largest non-infrastructure corporate bond and commercial papers offer ever floated in the Kenyan market.
EABL said applicants in the offer, which was open for 15 days beginning October 6, 2021, will be allotted notes of a minimum KSh 100,000 and the balance on a pro-rata basis in multiples of KSh 10,000.
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The medium-term notes will begin trading at the Nairobi Securities Exchange (NSE) in the coming week. Vote of confidence
EABL Group CEO, Jane Karuku, said the oversubscription is a demonstration of investors’ confidence in East Africa’s largest manufacturing business, which will celebrate its centenary next year. “The fact that this achievement was delivered in the face of depressed economic conditions further signifies the belief investors have in our strategy as this business turns 100 next year,” said Karuku. The five-year, fixed-rate instrument is offered at an interest rate of 12.25% payable semi-annually. The offer was opened on October 6 and closed on October 21 and will be listed for trading on the Nairobi Securities Exchange from November 1.
Commenting on the development, Capital Markets Authority CEO Wyckliffe Shamiah said the performance of the EABL Medium Term Note is a testament to the renewed interest in the corporate bond market with growing issuer and investor confidence.
He added that in the last 11 months, the Authority has approved the issuance and listing of the Centum Investments Company Plc KSh s4 billion medium-term note with a KSh2 billion greenshoe option, and the KSh 8 billion […]
