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KenGen Managing Director and CEO, Rebecca Miano

Kenya

KenGen inches closer to fully redeeming Sh25bn PIBO

KenGen Managing Director and CEO, Rebecca Miano said the second last instalment redemption of the 10-year PIBO was paid on April 30/CFM BUSINESS

NAIROBI, Monday, May 13 – East Africa’s leading electricity generator, Kenya Electricity Generating Company (KenGen) is inching closer to fully redeeming its Sh25 billion Public Infrastructure Bond Offer (PIBO).

The company has made the second last instalment redemption for the Infrastructure Bond amounting to Sh1,562.5 million and interest payment of Sh193.7 million to its bond holders.

Speaking earlier Monday, KenGen Managing Director and CEO, Rebecca Miano said the second last instalment redemption of the 10-year PIBO was paid on April 30 and the last instalment redemption and interest is due for payment on October 31, 2019.

“The Sh25 billion PIBO was floated in 2009 with an interest of 12.50pc to be paid semi-annually together with 16 equal redemptions of which 15 have since been paid. The last instalment redemption and interest is due for payment on 31st October 2019,” the MD said.

Miano observed that KenGen has consistently and promptly paid interest and principal to bondholders. “We are grateful to the bondholders who have shown confidence in the company by investing in the bond,” she added.

The purpose of the bond was to finance the firm’s energy projects. The company has been able to utilise the same towards increasing its installed capacity by 60pc from 1,021MW in 2009 to its current capacity of 1,631MW, leading to increased operations that have seen the company grow its revenue almost threefold from Sh13.1 billion in 2009 to Sh35.9 billion in 2018.

Infrastructure bonds are essentially issued for purposes of financing infrastructure projects of public interest. The KenGen PIBO was well received by investors. Unlike other securities, infrastructure bonds are tax-free, making them more attractive to investors who include foreign buyers.

The KenGen PIBO was and remains the only corporate infrastructure bond that has ever been issued and traded on the Nairobi Securities Exchange (NSE).

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