Two Rivers Invokes Debt Restructuring, Replace Loan With Equity

Two Rivers Lifestyle Center, the holding company of the Two Rivers Mall on Monday said it has inked a Ksh 4.5 billion deal that will see it convert part of their loans into equity as part of debt restructuring.

The Two Rivers Lifestyle Center, which encompasses Two Rivers Mall and Two Rivers Office Towers, is co-owned on a 50:50 basis by Old Mutual Properties and the Two Rivers Development Ltd where the Nairobi Securities Exchange-listed Centum Investment Company, AVIC and Kenya Development Corporation (KDC) are shareholders.

“The financing arrangement will see the replacement of a substantial portion of the existing senior loan with a zero-coupon instrument, but which participates in the upside of on the equity value uplift on the Center,” said James Mworia, CEO of the Centum Investment Company Plc.

In a statement, the deal was made possible by improved performance of the Two Rivers Lifestyle Center in the past two years since My Spectrum Limited, a property management company headquartered in Europe, took over its day-to-day management.

The financing agreement is expected to yield savings in interest costs of  KSh340 million per annum and will see the Center achieve profitability after interest and be cash flow positive after annual debt service.

Two Rivers Development saw an improvement in sales and investment income which grew from a loss of Ksh 32.5 million in HY 21 to a profit of Ksh 474.5 million.

“This agreement has further reinforced our confidence behind the Centre and its potential and we are confident that the financing arrangement will strengthen the Center and enable it to further deliver as a strong destination for tenants and shoppers,” said Peter Levett, the Managing Director of Old Mutual Properties.

Two Rivers Mall is the biggest shopping mall in East Africa with 67,000 square metres of retail space.

“As a management team, we’re excited to have this new financing arrangement. It has bolstered our strategies, plans and thinking in making the Centre an attractive destination,” said Theodoros Pantis, managing director of Two Rivers Lifestyle Centre.