Safaricom PLC has attracted Ksh41.6 billion in applications for the first tranche of its green bond, overshooting the initial Ksh15 billion target by 175.7 per cent.

The company exercised a Ksh5 billion greenshoe option, bringing total allocations to Ksh20 billion. As a result, Safaricom will refund Ksh21.4 billion to investors due to the strong demand.

Green bonds are debt instruments issued to finance projects that deliver environmental benefits. Safaricom will use the proceeds to expand solar power across its base transmission stations, improve energy management systems, and reduce overall energy consumption. These initiatives support the company’s sustainability commitments while enhancing operational efficiency.

The first tranche forms part of Safaricom’s Ksh40 billion Medium-Term Note (MTN) programme, approved by the Capital Markets Authority in November 2025.The MTN programme allows Safaricom to issue different types of notes, including green, social, and sustainability bonds, in multiple tranches.

This approach enables the company to diversify funding sources and tap into Kenya’s domestic debt market more effectively.

The five-year fixed-rate green bond offers a 10.4 per cent interest rate, paid semi-annually in June and December. A major attraction for investors is that the interest is fully tax-exempt under Kenyan law, allowing them to receive the full return without deductions.

Market shows strong confidence

Chief Executive Officer Peter Ndegwa said the oversubscription shows investor confidence in Safaricom’s performance, prospects, and strategic direction.

“We are pleased with the market’s response. It signals confidence not only in our balance sheet, but also in the vision and strategy we are executing. We made a deliberate decision to diversify our funding sources, and this outcome affirms this choice,” said Peter.

Ndegwa added that exercising the greenshoe option allows more investors to participate in Safaricom’s growth rather than being locked out.

“Taking up the greenshoe option allows more investors to participate in Safaricom’s growth, rather than locking them out.”

Investors could subscribe to the bond through USSD, online platforms, or licensed stockbrokers. The minimum subscription was Ksh50,000, with top-ups in increments of Ksh10,000. The bond attracted both retail and institutional investors, making it Kenya’s largest green bond to date and the first to allow mobile-based subscriptions.

SBG Securities, Stanbic Bank Kenya, and Standard Chartered Bank Kenya arranged the issuance, with Dyer & Blair Investment Bank acting as a placing agent. The green notes will be listed and start trading on the Nairobi Securities Exchange on Tuesday, December 16.