Kenya bags Sh170 billion in deals at UK-Africa summit

Tuesday, January 21st, 2020 00:00 |
President Uhuru Kenyatta during the launch of the Sh4 billion Acorn Green Bond at the London Stock Exchange (LSE). The bond is cross-listed at both the Nairobi and the London bourses. Photo/PSCU

Kenya has bagged investment deals worth £1.3 billion (Sh170 billion) from the UK during the UK-Africa Investment Summit 2020 currently going on.

The British High Commission in Nairobi said in a statement yesterday that the resources will be invested in housing, finance, renewable energy and entrepreneurship.

A memorandum of understanding on mobilising private financing for Kenyan projects by utilising British expertise to accelerate Kenya’s economic development was also signed.

UK, which is Kenya’s largest foreign investor, said the £30 million (Sh3.9 billion) housing deal will go towards construction of 10,000 affordable, energy efficient, and low-carbon homes for rent and sale.

British alcoholic drinks manufacturer, Diageo, said it will build a factory worth £167 million (Sh21.9 billion) in Kenya, having constructed another £120 million (Sh15.8 billion) brewery in Kisumu, which generated 100,000 direct and indirect jobs.

British High Commissioner to Kenya Jane Marriot said Kenya’s private sector was key to unlocking the country’s economic potential.

“The UK has a huge amount to offer ambitious African firms and we have a strong reputation for quality, integrity and reliability,” said Marriot.

The UK-Africa investment summit brings together 21 African countries, the UK, and African companies and is seeks to strengthen trade between UK and Africa in the post-Brexit era.

Meanwhile, President Uhuru Kenyatta launched the Acorn Green Bond at the London Stock Exchange (LSE) whose trading started immediately, making it the first Kenyan shilling-denominated corporate green bond to be listed in the UK.

The more than Sh4 billion bond floated by Acorn Holdings, a Nairobi-based property developer, is cross-listed on both the Nairobi Securities Exchange (NSE) and the LSE.

Offering a12.5 per cent annual interest, the started trading on the NSE Monday last week following a successful launch that was attended by among others the UK secretary of state for international development Alok Sharma.

Proceeds from the Acorn green bond will go towards building a 50,000 capacity eco-friendly hostels for students in Nairobi.

Speaking during the bell ringing ceremony in London, Uhuru commended LSE for being the first global exchange to set up a dedicated green bond segment saying the security provides a great opportunity for African countries, which are vulnerable to the effects of climate change, to access large scale capital for sustainable growth.

“To date the LSE has admitted more than 200 bonds from across the world, raising over £33 billion (Sh4.3 trillion) worth of capital for sustainable development,” said Uhuru.

The green bond was first issued in August last year to select institutional investors after which Acorn Holdings announced that the bond had attained 85 per cent subscription raising Sh4.3 billion out of the targeted five billion shillings.

In earlier interview, NSE chief executive Geoffrey Odundo described the bond as a good investment opportunity saying it would offer a good learning experience on how NSE should conduct future cross-listings.

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