NAIROBI, Oct 27 (Reuters) – The real estate subsidiary of Kenya’s Centum Investment CTUM.NR plans to issue a 4 billion shilling ($36.78 million) corporate bond to finance its housing developments, the parent company said on Tuesday.
The three-year, zero coupon bond, which will be floated in the next few weeks, will come at a discount rate on the three-year Treasury bond and a market-determined margin, Centum Investment said.
“Investors who buy the bond will have an option of investing in an equity-linked component,” it said in a statement.
The subsidiary, Centum Real Estate, will have a green shoe option of taking bonds worth up to 2 billion shillings more if the issue is oversubscribed, the parent company said.
Cash from the issue will fund the subsidiary’s ongoing projects, consisting of 4,426 residential units, targeted at market segments from affordable to the high end, Centum Investment said.
“The bond will be