Kelp Blue Plans to Issue Africa’s First Corporate Blue Bond

(Bloomberg) -- Kelp Blue plans to issue Africa’s first corporate blue bond next year to expand its giant kelp forests along Namibia’s coast.

The De Beers-backed startup will list the first $20 million tranche of a four-year program, in which it seeks to raise as much as 3 billion Namibian dollars ($173 million), on the country’s stock exchange in 2025, it said in response to emailed questions Wednesday.

The debt will also be the world’s first blue bond committed to funding sustainable aquaculture, the seaweed company said. “The creation of an instrument of this type will allow other companies to acquire funding more easily,” it said.

Blue bonds are debt instruments issued by companies or nations to fund projects that help protect or revive the world’s oceans and waterways in the face of climate change, overfishing and pollution.

Kelp Blue’s forests serve as natural habitats and carbon sinks, helping to counteract the effects of climate change by absorbing CO2 and enhancing ocean resilience. The company also processes harvested kelp into products such as StimBlue+, a biostimulant sold to European farmers, and materials for bioplastics, cosmetics, and textiles.

Moody’s Ratings last week assigned an SQS1 Sustainability Quality Score to the seaweed company’s blue bond framework, a distinction held by only 8% of applicants globally.

“We’re incredibly excited about opening up a new form of financing for blue projects worldwide,” Kelp Blue’s Chief Financial Officer Cayne Moffat said. The Moody’s rating will strengthen the bond’s market appeal, he said.

The startup founded in 2020 has licenses to grow its kelp over 6,400 hectares (15,815 acres) in Namibia. It also operates in Alaska and New Zealand, and plans to expand to locations where the conditions are favorable including in the nations it’s already in, the company said.

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