NAIROBI, Kenya, May 8 – The East African Breweries Limited has listed its second bond on the Nairobi Securities Exchange (NSE).
The listing of the Note on the NSE will provide an avenue for investors who were unable to participate during the offer.
The Note will bear interest at a fixed annual rate of at least 14.17 per cent until maturity on March 28, 2022.
“The success of this issue clearly demonstrates the confidence that EABL has in our market – as one that is well regulated, deep and liquid – well suited to their needs. The ability of issuers such as EABL to continue to come to market and raise greater amounts of capital, also points to the acknowledgement of their quality and the rising investor appetite in our market for debt securities, ” said the Nairobi Securities Exchange CEO Geoffrey Odundo.
The bond had been oversubscribed by 141 per cent with the firm getting Sh8.45 billion from a target of Sh6billion.
EABL’s Group Managing Director, Andrew Cowan says the funds will be used to restructure the balance sheet which entails repayment of short term loans.
The bond is the second Tranche of an issue that was first offered to the market in 2015.
The firm targeted to raise Sh11 billion in two tranches and has generated Sh17.4 billion.
“The response that this Note has generated demonstrates the confidence that the market has in the EABL brand. The raised capital will significantly strengthen the business’ position and competitiveness. This will enable us to effectively operate through strategic investment in our capacity, people, brands and innovation while consistently delivering value to our customers, shareholders and communities across the different markets that we operate in,” added Cowan.
EABL made Sh5.6 billion profit after tax, in its half ending December 31, 2016 – a 2 per cent increase from the previous year.
The results were buoyed by Uganda’s net sales which went up by 7 per cent while Kenya recorded flat growth and Tanzania recorded a 7 per cent decline.
The period was marred by a tough external business environment as taxes continued to bite hard in their revenues.