Kenya Markets $2.5 billion Eurobond

Kenyan officials visiting Europe and the US are marketing the country’s $2.5 billion Eurobond.

The Eurobond is the third issued in five years and comes as concerns grow regarding the country’s level of public debt and following an IMF debt distress downgrade from low to moderate in October last year.

In addition to financing the budget, Kenyan Treasury officials must also repay a formerly issued $750 million Eurobond next month.

The bond comes in two tranches of 12 and 31 years and will be listed on the stock exchange in London and Ireland. JP Morgan and Standard Chartered are the lead arrangers.

Commenting on the latest Eurobond, global rating agency Moody’s stated, “A successful issuance would support Kenyan government’s foreign exchange liquidity. However, in time its increased reliance on external commercial debt would come at the expense of higher exchange-rate risks and interest payments for the government, aggravating an already large and persistent fiscal deficit.”