Kenya has launched a tender offer to repurchase up to Ksh64.4 billion ($500 million) of its outstanding Eurobonds, as part of a broader plan to manage its external debt repayments.

Kenya announced on February 18, 2026 that holders of two series of U.S. dollar-denominated notes are invited to tender them for cash purchase.

The offer targets up to Ksh45 billion ($350 million) in principal of the 8.000 per cent amortising notes due May 22, 2032 and up to Ksh19 billion ($150 million) of the 7.250 per cent notes due 28 February 2028. These amounts include accrued interest.

For the 2032 notes, Kenya will pay Ksh135,937 ($1,055) per Ksh128,850 ($1,000) principal, equivalent to 105.50 per cent of the accepted amount. The 2028 notes will be bought at $1,035 per $1,000 principal, or 103.50 per cent. The government will also cover any accrued interest on the accepted notes.

The offers opened on February 18, 2026 and are set to close at 5:00 p.m. New York City time on February 25, 2026, unless the Republic decides to extend, reopen, amend, or terminate them. Noteholders must submit their tenders through intermediaries, as clearing system deadlines fall earlier. The minimum tender size is $200,000 principal, with further increments of $1,000.

This buyback forms part of Kenya’s ongoing liability management strategy. The government has linked acceptance of these tenders to the successful issuance of new U.S. dollar-denominated notes, called the “New Notes.” Kenya intends to announce this new issuance on the same day. Settlement of the buyback will depend on completing that financing on terms deemed acceptable by the government.

Debt buyback

The government holds sole discretion to accept or reject any tenders, modify the maximum purchase amounts, or cancel the offers entirely. Any repurchased notes will be cancelled, reducing Kenya’s outstanding external commercial debt.

Noteholders who tender or indicate a firm intention to tender will receive priority consideration for allocations in the new notes.

“The Republic intends to give preference to those noteholders who have tendered, or indicated firm intention to tender, notes of either series,” the government stated.

However, it emphasised that it is under no obligation to allocate new notes to these investors. Those wishing to purchase additional new notes must apply separately through the deal’s managers.

This buyback follows similar operations in recent years. In October 2025, Kenya repurchased $628.44 million of its 2028 notes after raising $1.5 billion through a dual-tranche Eurobond issuance.

Observers note the pattern of repurchases, including multiple operations of the 2028 notes within the past year, signals Kenya’s intention to refinance and extend maturities. The government appears to focus on smoothing the repayment profile of its 2028 and 2032 notes, while offering allocation preference in the new notes to those who participate in the tender.

Market conditions seem supportive. Bloomberg data showed secondary market yields fell to 6.14 per cent for the 2028 notes and 7.14 per cent for the 2032 notes on the announcement morning, suggesting investors welcomed the pricing.

The tender offer comes ahead of an International Monetary Fund (IMF) mission to Kenya later this month. Discussions may focus on Article IV consultations and debt sustainability rather than a new funded programme.

Kenya’s approach aims to stretch repayment obligations, reduce near-term bullet payments, and maintain access to international markets. By exercising full discretion over the process, the government ensures it can adjust or cancel the buyback if conditions change.