Shelter Afrique, a Pan-African housing development financier says it has fully paid commercial debts owed to eight lenders three years ahead of schedule, giving the company the leverage to issue new regional bonds.
In 2018, Shelter Afrique signed a Debt Restructuring Agreement with the eight lenders – six DFIs and two commercial banks – to restructure its debt amounting to USD186 million with a new 5 – Year tenor to run from June 2019 to June 2024.
The USD186 million (including accrued interest) owed to African Development Bank, Agence Française de Developpement, Commercial Bank of Africa, European Investment Bank, German KFW, Ghana International Bank, CFA-Banque Ouest Africaine de Development, and Islamic Corporation for Development.
“Despite Debt Restructuring Agreement giving us a window to make full loan repayment by June 2024, we successfully repaid all the loans by June 2021. ” said Shelter Afrique Group Managing Director and CEO Andrew Chimphondah.
According to the CEO, the company could raise new debt of up to USD 465 million based on the lender’s current Equity Capital base of USD 155M and a debt-equity ratio of 0%.
The company has also repaid a bond floated on the Nairobi Stock Exchange between 2013 and 2018.
Mr Chimphondah added that following the development, Shelter Afrique now plans to return to the capital markets to raise KES 125 billion (USD1.25 billion) in local-currency bonds by the end of the year.
“With the debts fully retired, we now intend to mobilise a local-currency equivalent of USD500 million each from Nigeria and East Africa, as well as USD250 million from French-speaking African nations. These will be crucial in funding our demand-side pipeline of as much as USD1 billion which we are currently developing,” Chimphondah noted.
Furthermore, Shelter Afrique is exploring further shareholder financing and is already in talks with some organisations and countries.