This archive report was first published on 1 November 2021.
On November 1, 2021, East African Breweries Plc's Medium-Term Note was listed on the Nairobi Securities Exchange, marking a significant milestone in the company's capital-raising efforts.
The KSh11-billion issue was oversubscribed by 245 percent, with individual and retail investors comprising 32% of applicants and institutional investors covering the rest.
Group Managing Director and CEO Jane Karuku performed the ceremonial bell-ringing ceremony to mark the start of trading, describing the Note as the company's most successful capital-raising issue and the reception as an expression of confidence in the company's strategic vision.
“Although we at EABL have been in the capital markets before, this was a different time to ask for money – given the prevailing economic conditions, especially relating to the COVID-19 pandemic. Nevertheless, because EABL has a clear strategic ambition, we considered that investors would believe our story, especially given that we have shaken off a very difficult period the pandemic hit our shores,” said Mrs Karuku.
The five-year, fixed rate instrument is offered at an interest rate of 12.25 percent payable semi-annually. The offer was opened on October 6 and closed on October 21 and is now listed for trading on the Nairobi Securities Exchange.
The funds will be used to finance investments in expanding production, repay debts taken in the ordinary course of business, refinance short-term borrowings, and provide working capital.
The transaction was arranged by Absa Bank Kenya Plc and Absa Securities, with Bowmans Kenya as the legal counsel and Image Registrars as the registrar and paying agent.
