NAIROBI, Kenya, Sep 22 – Acorn Holdings Limited (AHL), a property developer, plans to redeem the Sh5.7 billion green bond, Africa’s inaugural green housing bond, one month ahead of its official maturity date.
The early repayment, set for the first week of October 2024, will return up to Sh2.7 billion in principal to bondholders, alongside accrued interest.
Originally issued in 2020, the bond not only marked a significant step for green finance in Africa but also became the first bond cross-listed on both the International Securities Market of the London Stock Exchange and the Nairobi Securities Exchange.
Its proceeds have primarily funded the construction of safe, affordable, and environmentally sustainable student accommodation across Kenya.
AHL says the early redemption highlights its financial strength and the resilience of its underlying portfolio, which has allowed the company to fulfil its obligations to investors.
“The early redemption not only reflects the financial prudence on Acorn’s part, but also the robustness of the underlying portfolio that has enabled it to meet its obligations to investors,” it said in a statement.
The bond was partially guaranteed by GuarantCo and supported by a corporate guarantee from AHL.
Since its issuance before the onset of the COVID-19 pandemic, the Green Bond has reinvigorated Kenya’s corporate bond market and fostered investment in certified green assets.
It has attracted over Sh5.5 billion from local pension funds through co-investment initiatives and has facilitated a Sh6.7 billion green facility from ABSA, along with $180 million from the U.S. Department of Finance Corporation.
The funding has enabled the completion of six purpose-built student accommodation (PBSA) projects, providing approximately 7,000 beds, with notable facilities such as Qwetu and Qejani Chiromo, which recently opened to students in August 2024.
Beyond enhancing educational infrastructure, the Green Bond has significantly impacted the local economy by creating over 2,000 direct jobs and more than 10,000 indirect jobs, while promoting sustainability through renewable energy installations.
Its projects are strategically located near universities, reducing greenhouse gas emissions associated with student transportation.
Recognised by the Climate Bonds Initiative, all developments financed through the bond are IFC EDGE certified, further solidifying AHL’s commitment to sustainable practices.
The company has been acknowledged as an EDGE Champion in Africa, reinforcing its leadership in green development.
With over Sh1.4 billion in coupon payments made to investors since its inception, the early redemption of the Green Bond marks a significant milestone for both Acorn Holdings and the advancement of green finance in the region.
