Acorn Holdings, listed under the Fixed Income Securities Market Segment of the Nairobi Securities Exchange (NSE), is set to delist from the bourse after it opted for an early redemption of its KSh5.7 billion green bond.
- The real estate developer was the first to issue a green housing bond on the continent, in 2019.
- The bond is held held by the company’s Acorn Student Accommodation (ASA) Development Reit and has been paying annual interest of 12.5 percent to investors.
- The ASA D-REIT is the investment vehicle that develops Student Accommodation properties from land acquisition to construction and completion.
Once the assets have achieved stable occupancy, they are sold to the ASA I-REIT on a commercial arms-length basis, providing D-REIT investors with capital gain returns.
The 5- year medium term note issued in November 2019 was set to mature on 8th November 2024 with the outstanding balance amounting to KSh2.7 billion. However, the KSh2.7 billion will be repaid on 4th October 2024.
“The notes will be redeemed at an amount equal to the nominal value of the notes, together with accrued but unpaid interest from the preceding Interest Payment Date up to and including the Early Redemption Date,” Acorn said in a notice released on Friday.
In February 2023, the property developer secured a KSh 6.7 billion Absa debt to fund 10 projects including both Qwetu and Qejani KU, Qejani Hurlingham and Qejani Juja. In May 2024, Acorn secured an additional US$180 million from the U.S International Development Corporation (DFC) as a seed facility of US$700 million including a financing arranged by Stanbic Bank Kenya.
“The transaction will also crowd-in over $315 million equivalent KSh financing from Kenyan capital markets, including domestic pension funds and asset managers, for a total blended financing of $700 million over the 18- year life of the transaction,” Acorn noted earlier in the half year report.
In relation to the funding, Acorn had disclosed earlier that they do not intend to issue another corporate bond pointing partly to the prevailing high interest rates regime. Acorn Holdings was the largest unit holder as of 30th June 2024, holding 70.6 percent with InfraCo Africa Investment coming in second with 6.2 percent.
“In connection with the early redemption, the Notes will be delisted from the Fixed Income Securities Market Segment of the Nairobi Securities Exchange,” the real estate developer added.
