Kenya launches second bond offering with planned US$50 million for geothermal

Alexander Richter 12 Kas 2009

Kenya just launched its second infrastructure bond inviting bids for an 18.5 billion shilling (US$ 260 million), of which US$ 50 million are aimed for geothermal development in the country.

Reported from Kenya, the country “launched its second infrastructure bond on Thursday, inviting bids for an 18.5 billion shilling (US$ 260 million) 12-year issue with a 12 percent coupon, the central bank said in a statement.

The launch follows the success of Kenya’s debut infrastructure bond issued in January. The bond was 45 percent oversubscribed and recent Kenyan corporate and government debt issues have also attracted strong demand.

Kenya unveiled a stimulus package in its 2009/10 budget, earmarking increased borrowing for infrastructure projects to maintain growth in east Africa’s biggest economy following the global economic slowdown.

The Central Bank of Kenya said 5 billion shillings would go towards new roads, 4 billion would fund refurbishment of civil works and rural electrification schemes would get 1.5 billion.

The banks said geothermal energy resources and exploration would receive 3.5 billion shillings (US$ 50 million) and 4.5 billion of the proceeds would fund water, sewerage and irrigation projects.

The bond will be on sale from November 12 to November 24 with a value date of November 30. Interest will be paid semi-annually and will be exempt from withholding tax, as was the case with Kenya’s first infrastructure bond.”

Source: Reuters