EABL says medium-term bond oversubscribed

EABL says medium-term bond oversubscribed

East African Breweries (EABL) got a 141 percent subscription rate for its five-year corporate bond, the company said on Wednesday.

The company, which is controlled by Britain’s Diageo, said investors offered 8.45 billion shillings ($82 million), well above the 6 billion shillings it sought.

“These funds will be used to restructure our balance sheet which entails the repayment of short term loans, replacing them with the medium term debt,” Gyorgy Geiszl, the group’s chief financial officer, told Reuters.

The bond is the second tranche of an issue that was first offered to the market in 2015.

Geiszl said the restructuring of the balance sheet would also help the group comply with the market regulator’s current asset ratio rules. The bond has a fixed annual rate of 14.17 percent, well above the current rate on the Kenyan 364-day Treasury bill of 10.914 percent.

Geiszl said there were no immediate plans to raise more debt, but the firm would review the situation if the need arose.

“We see numerous growth opportunities in the countries that we operate in. If any of those materializes beyond our business-as-usual level of investment, we will reach out to the markets for funding,” he said.

Tags:

debt eabl Interest rate Beer investment capital raising east african breweries limited Diageo coupon rate alcoholic drinks balance sheet restructuring corporate bond Gyorgy Geisz

Want to send us a story? Submit on Wananchi Reporting on the Citizen Digital App or Send an email to wananchi@royalmedia.co.ke or Send an SMS to 25170 or WhatsApp on 0743570000

Leave a Comment

Comments

No comments yet.

latest stories