Kenya’s main electricity generating company, KenGen, has announced that it will be making the final payments to bond holders of its 10-year, KSh 25 billion infrastructure bond.
This bond was issued on 2nd November, 2009 when President Uhuru Kenyatta was the then Finance Minister.
In a statement, the company said interest payment will also be paid on Thursday, 31 st October 2019 at a fixed rate of 12.5 % per annum, at no tax charge, on the principal amount of the Bonds outstanding on the record date (book-closure date), to the Bondholders whose names appear on the Register of Bondholders at the close of business on Friday, 11th October 2019.
“All CDSC account holders are requested to update their bank, address, e-mail and telephone details at the CDSC through their Stockbroker and/or Custodian Bank,” said Paul Ndungi, the Company Secretary in a statement.
Following the last redemption payment, the bond will be delisted from the Corporate Bond list at the Nairobi Securities Exchange.
The 10-year bond is priced at par and carries a 12.5 % annual coupon.
The then Finance Minister Uhuru Kenyatta told the launch ceremony then, that Kenya’s capital market is vibrant enough to support the company’s bond and the government’s own targeted borrowing requirements, which stood at Sh 109.5 billion shillings at the time..
The firm’s infrastructure bond has a good take-up rate because the issue offered tax-breaks to bond holders
This corporate bond, which was selling until September 29, has a net interest rate of 12.5% yield per year for 10 years.
KenGen, which generates 80 percent of Kenya’s electricity requirements, sought funds from the bond to invest in diverse sources of energy like geothermal, in line with the company’s strategy of investing at least Sh 40 billion in generation each year to keep up with rising demand.
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