Citi and Standard Bank, as Joint Lead Managers (JLMs), have recently orchestrated a new Eurobond issuance and Tender Offer for the Republic of Kenya through the National Treasury & Economic Planning. This new issue amounts to a substantial US$1.5 billion, with a buyback of Kenya’s Eurobond 2027 totaling US$579 million.
The role of the JLMs in managing this successful Eurobond issuance and buyback highlights Kenya’s proactive debt management strategy. This transaction has not only strengthened market confidence but also demonstrated strong investor demand, resulting in tightened pricing and increased issuance. This reaffirms Kenya’s access to international capital markets.
Citi and Standard Bank’s advisory role for Kenya in this transaction is paramount. As Joint Lead Managers, they have played a crucial part in supporting Kenya’s debt sustainability. This marks their second consecutive successful transaction with the Government of Kenya, solidifying their position as key advisors and partners to the government.
This transaction further cements Citi and Standard Bank’s reputation as trusted brands on the continent. Their involvement in this Liability Management mandate with the Government of Kenya showcases their commitment to supporting the government in proactively managing their debt, debt maturity profile, and overall debt sustainability.
The new Eurobond issuance was strategically used to buy back upcoming Eurobond maturities and expensive external debt, effectively de-risking the maturity profile. This proactive debt management approach demonstrates the government’s commitment to sustainable debt service and positively influences market access at sustainable levels.
The Eurobond issuance garnered strong demand from investors looking to support Kenya’s debt management strategies. This enabled the Republic of Kenya to tighten pricing and increase the issuance size, surpassing initial guidance. The Tender Offer was also successful, with over 64% participation from investors, leaving $321 million in bonds outstanding. This transaction underscores Kenya’s proactive debt management strategy and instills confidence in domestic and international investors, aiding in the realization of the country’s economic and investment potential.
The Eurobond, which was priced at a 9.95% yield with a 9.50% coupon, will mature in 2036 with a ten-year weighted average life. The proceeds from the Eurobond issuance were utilized to fund the Tender Offer for the 2027 Notes, settling on March 10, 2025.
Martin Mugambi, Citibank Kenya Managing Director & CEO, expressed his satisfaction with the transaction, highlighting Citi’s role as a trusted advisor and partner to sovereigns in accessing global capital markets. Dr. Joshua Oigara, Chief Executive of Stanbic Bank in Kenya and South Sudan, a member of Standard Bank Group, commended the successful transaction, emphasizing investor confidence and Kenya’s growth potential.
This successful Eurobond issuance and Tender Offer not only showcase Kenya’s proactive debt management strategy but also highlight the strong partnership between the government and leading financial institutions like Citi and Standard Bank.
