Centum Real Estate has announced an early payment for its Sh3 billion corporate bond, underscoring the company’s strong financial position.
This means that investors in the corporate bond will receive payment, about three weeks ahead of the bond’s maturity of December 16, 2023.
The bond holders will get full interest payment to the date of maturity.
According to the investments firm, investors were to earn a return of 12.5 percent for the Sh2.6 billion plain bond and 12 per cent on the Sh354 million equity-linked bond.
Centum Re managing director, Kenneth Mbae, said the bond repayment is funded from internally generated cash.
“This payment underscores our strong liquidity position and there is no need to hold investors cash any longer” added Mbae.
Since the bond raise in 2020, Centum Re has been pushing to developed a healthy pipeline and pre-sold homes with signed contracts of Sh20.3 billion and collected Sh11.7 billion from customer deposits.
Corporate bonds represent debt securities issued by companies.
These entities utilise corporate bonds as a means to secure funding for various objectives, including constructing new facilities, acquiring equipment, or expanding their operations.
These bonds essentially constitute financial liabilities on the part of the issuer, which is the company responsible for their issuance.
The early payment comes a month after Global Credit Rating upgraded Centum Re’s credit rating citing strong cash flows.
GCR affirmed the stable outlook of Centum Real Estate’s national scale, long and short-term issuer ratings of BBB+(KE) and A2(KE) respectively, as well as the rating of its corporate bond.
The company is the leading developer of mixed-use urban nodes in the region, with large mixed-use developments in Nairobi, Kilifi and Entebbe in Uganda.
Centum Real Estate’s track record assures its investors of quality, value for money, timely handover of projects and a return on their investment, management said.
Centum Re is a fully owned subsidiary of the Nairobi Securities Exchange-listed Centum Investment Company.
The Group CEO James Mworia said the bond payment would make it easier for Centum Re to attract funding in the future, as it affirms its strong fundamentals.
“We have built from scratch a multi-billion-shilling enterprise that has even attracted international investors from the likes of IFC, the World Bank’s private sector lending arm,” said Mworia.
