KenGen PIBO gets the nod

August 27, 2009

, NAIROBI, Kenya, Aug 27 – The Capital Markets Authority (CMA) on Thursday approved KenGen’s Information Memorandum thus giving it the green light to raise Sh15 billion through the Public Infrastructure Bond Offer (PIBO).

KenGen Managing Director Eddy Njoroge said he was elated at this development which gives the electricity generator an opportunity to raise money to finance capital expenditure in a flexible manner.

“Plans are on course to bring the bond to the market in an effort to access funds to finance our capacity expansion programme,” he added.

He explained that the details of the KenGen PIBO, which is expected to give both institutional and retail investors an opportunity to participate, would be unveiled in due course.

He observed that there is a growing appetite for long term debt instruments, which they would like to leverage to finance investments in additional power generation capacity.

KenGen’s decision to seek funds from the Debt Capital Market is a break from the past where the company relied heavily on development financial institutions to finance its power generation projects.

It will also allow Kenyans to participate in infrastructural development through an attractive investment opportunity.

The investment in additional power generation capacity through the bond is part of KenGen’s five-year strategy (2008-2012) of increasing its capacity by 500 MW to stabilise the power situation in Kenya.

"This will enable us continue with our critical role of ensuring there is enough additional capacity to cope with the rising demand, anticipated at eight percent annually,” Mr Njoroge said.

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