Safaricom PLC has taken a major step in advancing sustainable finance in Kenya through the launch of its KSh 15 billion green bond, the largest corporate green bond issuance in the country to date. This significant move is part of the company’s KSh 40 billion Medium-Term Note Programme, which seeks to mobilize funding for projects that align with environmental preservation, energy efficiency, and long-term climate resilience. The issuance comes at a time when investors are increasingly showing interest in environmentally responsible investment options, creating a favourable environment for the adoption of green securities.
The bond carries a five-year tenor, meaning investors will earn fixed annual interest payments over five years before receiving their principal back at maturity. The fixed-rate nature of the bond offers stability and predictable returns, an especially appealing feature given current market uncertainty. Moreover, the bond’s tax-exempt status further enhances its attractiveness, providing investors with higher net returns compared to taxable alternatives.
Safaricom structured the offering with an initial KSh 15 billion base amount, which represents the primary capital target for this tranche. To accommodate potential excess demand, the company also included a KSh 5 billion greenshoe option, bringing the potential total to KSh 20 billion. A greenshoe option is a mechanism that allows an issuer to increase the size of the offering if investor interest surpasses expectations. This not only ensures more investors can participate but also allows the issuer to capture additional capital efficiently without issuing a separate bond. In Safaricom’s case, this flexible structure strengthens confidence in the offering and signals strong market appetite for sustainable investment products.
Proceeds from the green bond are designated exclusively for eligible environmental projects within Safaricom’s sustainability framework. These may include renewable energy installations, energy-efficient network systems, green building initiatives, and digital solutions designed to support climate adaptation. Such investments are aligned with the telco’s broader commitment to reducing carbon emissions and championing environmental stewardship across its operations.
A key highlight of this issuance is the accessible subscription process, which allows investors to apply through mobile platforms and licensed brokers. This democratizes participation, making it easier for retail and institutional investors alike to engage with Kenya’s growing sustainable finance ecosystem.
Market observers note that the success of Safaricom’s green bond is likely to set a precedent for other corporate issuers in Kenya. By combining strong investor interest, environmental purpose, and a flexible structure, the Safaricom 15B green bond marks a defining moment for Kenya’s transition toward innovative, sustainability-driven capital markets.
