Kenya Raises $2.25B in Eurobond Sale to Fund Debt Buyback

BREAKING NEWSFebruary 25, 2026 at 4:37 PM UTC

TLDR

Kenya secures $2.25 billion from international markets through a dual-tranche Eurobond for debt buyback and budget support
Government issues $900 million in notes due in 2034 at 7.875% and $1.35 billion in bonds due in 2039 at 8.700%
Transaction aims to smoothen Kenya's debt maturity profile, reduce refinancing risk, and improve market access for African sovereigns

Kenya has raised $2.25 billion from international markets through a dual-tranche Eurobond to finance a $500 million debt buyback and support its budget.

The government issued $900 million in notes due 2034 at 7.875% and $1.35 billion in bonds due 2039 at 8.700%, the finance ministry said. The sale follows buyback tenders launched earlier this week for up to $150 million of bonds maturing in 2028 and up to $350 million of bonds due in 2032.

The buyback offer closes on Feb. 25, with results expected on Feb. 26.

The transaction is part of Kenya’s effort to smooth its debt maturity profile and reduce refinancing risk. The country faced market pressure in 2024 amid concerns about its ability to meet external debt obligations, which led to a downgrade and currency volatility.

Kenya returned to the Eurobond market twice last year, signaling renewed access after tighter global financial conditions limited borrowing.

Several African sovereigns, including Ivory Coast and the Republic of Congo, have also tapped international markets this year as investor appetite for higher-yield emerging-market debt improves.

Key Takeaways

Kenya’s liability management strategy reflects a broader reopening of the Eurobond window for African issuers. Narrowing spreads against U.S. Treasuries have allowed governments to refinance near-term maturities with longer-dated debt. By replacing shorter-term bonds with 7-year and 12-year instruments, Kenya aims to ease repayment pressure and stabilize its borrowing curve. Ratings agencies have taken a cautious view, with recent upgrades citing reduced near-term default risk. However, structural challenges remain. Public debt levels are high and tax mobilization remains weak. Sustained fiscal discipline will be required to maintain investor confidence. The success of the bond sale indicates that global investors are willing to price African risk when policy direction appears stable. Continued market access will depend on execution of fiscal reforms and growth performance.

Kenya