Alea iacta est

Portland Cement to convert yen loans to dollars [Business Daily]

East African Portland Cement Company EAPC:KN will next month swap its expensive yen-dominated loans for dollars and convert to a coal driven plant in efforts to cut cost and return to profitability in 2011... Continue

5-yr JPY/KES

swapping for USD will not give them any recourse, WHY CANT THEY SWAP FOR KES?

KES is not recognized currency by other countries even trade with our neighboring countries is in USD.

Anyway, I have no pity for EAPC miseries. They dug themselves into this hole needlessly and now they have to climb out. That said, I think this share is at a big bargain at the current price lakini sina niadu.

The kenyan currency is not a recognised currency in the derivative market because its value wrt other major currencies is weak--the kenyan currency does not get traded in an otc market or used in the forex market as other major currencies like the dollar or the pound or the euro.

the swap market involves large amounts of currencies and in large volumes (you can imagine a $10,000,000 transaction converted to kes approx 810,000,000 is quite alot of money in kenya).further imagine 8-10 transactions of this magnitude a day can really shake up the kenyan economy.

This is a good move by EAPCC to manage the loan repayments and most importantly cashflows moreso when the company is trying to recover from a period of loss generation.