The Treasury has opened a second sale of this month’s infrastructure bond, seeking an additional Sh10 billion to the Sh30 billion raised last week.
CBK said that the tap sale will run from October 25 to November 3, and investors taking up the second offer will earn the same interest as that of the initial bond sale.
In last week’s initial sale of the tax free 15-year tenor infrastructure bond, investors offered Sh35 billion, with the government taking Sh30.6 billion at a rate of 13.17 per cent.
Analysts say that the tap sale is targeting both the excess offers from the initial sale as well as maturities of existing debt.
“This tap sale comes in immediately after the maturities of the amortised one-year bond issued last year were paid out yesterday, an indication that CBK is targeting these maturities,” said Genghis Capital in a fixed income brief on Tuesday morning.
A successful tap sale will therefore bring the total proceeds from the bond issue to Sh40 billion, which was the maximum the government had set out to get from the issue.
These funds are meant to fund projects in the roads sector (Sh10 billion), energy (Sh10 billion) and water (Sh20 billion).
This is the second infrastructure bond sold this year after the nine-year offer in May, which raised Sh34 billion at a rate of 13.34 per cent.