The Government of Kenya has completed a US$415.4 million, or KSh 53.6 billion, Eurobonds buyback after concluding its tender offer, accepting all valid bids for its 2028 notes and partially taking up the heavily subscribed 2032 notes. The results were disclosed through the London Stock Exchange.
By the February 25 deadline, investors had tendered US$90.5 million of the 7.25 per cent notes maturing in February 2028 and US$892.1 million of the 8.00 per cent amortising notes due May 2032. While the 2028 bonds were taken up in full, demand for the 2032 paper far exceeded the buyback ceiling, leading to a scaled allocation.
Kenya ultimately accepted US$324.8 million of the 2032 notes, applying a final proration factor of 0.329471. Together with the full acceptance of the 2028 bonds, the transaction extinguished US$415.4 million of external debt.
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Bondholders will receive US$1,035 for every US$1,000 of principal on the 2028 notes and US$1,055 per US$1,000 on the 2032 notes, translating to 103.50 per cent and 105.50 per cent of face value respectively, in addition to accrued interest. Settlement is set for March 3, after which the repurchased securities will be cancelled.
The operation was financed through Kenya’s recent US$2.25 billion dual-tranche Eurobonds issue. That offering comprised US$900 million in seven-year notes maturing in 2034 at a 7.875 per cent coupon and US$1.35 billion in 12-year notes due 2039 at 8.700 per cent. Both tranches amortise in three equal instalments, effectively stretching the country’s maturity profile and easing the strain of large bullet repayments.
Treasury has positioned the exercise as a deliberate effort to smooth refinancing pressures ahead of the 2028 maturity and to manage amortisation obligations linked to the 2032 bonds. The move comes shortly after Moody’s upgraded Kenya’s sovereign rating to B3 from Caa1, citing reduced short-term default risk and improved external liquidity buffers.