The National Securities and Stock Market Commission (NSSMC) registered a public issue of dollar-denominated corporate bonds of Kernel-Trade LLC, which is part of Kernel agroholding. The total issue volume is $50 million.

The NSSMC reported this on November 3 on its website. According to the regulator, this is the first public issue of foreign currency corporate bonds of this scale on the Ukrainian market.

The company plans to place 50,000 bonds with a nominal value of $1,000 each. The sale will take place on the PFTS stock exchange. The issue is unsecured, meaning that the fulfillment of obligations to bondholders is not guaranteed by collateral.

According to the published terms, the placement is scheduled for November 9-20, 2026. Documents for the issue of series D bonds are published on the PFTS exchange website.

What terms are provided for investors

During the first six interest periods, i.e., approximately one and a half years, the bond rate will be 5.75% per annum.

After this period, the rate will be determined by the issuer's supervisory board. It may set it within the range of 2% to 10% per annum.

Interest income is planned to be paid quarterly. Redemption of the bonds, i.e., return of their nominal value, is scheduled for November 2029.

Thus, the rate of 5.75% is not fixed for the entire three-year circulation period of the securities. In the second half of this period, the yield will depend on the issuer's decision within the established range.

What the company plans to spend the funds on

According to the terms of the issue, the funding raised by Kernel-Trade will be directed to current operating activities.

The structure of the use of funds provides for:

  • 60% - for the purchase of agricultural products;
  • 30% - for the processing of oilseeds;
  • 10% - for trading, export and logistics operations.

In case of full placement of bonds, this would correspond to $30 million for the purchase of agricultural products, $15 million for oilseed processing, and $5 million for trading and logistics activities.

The NSSMC noted that the issue creates an additional opportunity for Ukrainian companies to raise foreign currency funding directly in the domestic capital market.

Previously, large Ukrainian enterprises mostly used foreign banks, Eurobonds, and private financial agreements for such borrowings.

For exporters that receive a significant portion of revenues in foreign currency, dollar borrowings can reduce risks associated with fluctuations in the hryvnia exchange rate.

Currency payments and risks

The nominal value of the bonds, interest income, and redemption amount are determined in US dollars. However, this does not mean an unconditional guarantee of receiving all payments exactly in foreign currency.

As explained by the NSSMC, payments in dollars are planned to be made only if permitted by currency legislation on the respective date.

During martial law in Ukraine, restrictions are in effect established by National Bank Resolution No. 18. Therefore, the actual procedure for settlements on the bonds will depend on the currency regulation rules in force at the time of payment.

The regulator also draws attention to credit risk, since the bonds are unsecured. In addition, investors must consider the possible change in the interest rate and the risk of low liquidity: selling the securities before maturity may be difficult in the absence of sufficient demand on the exchange.

Registration of the issue does not mean that Kernel-Trade has already raised $50 million. The actual volume of funding will be known based on the results of the placement.

The NSSMC separately emphasized that registration of the issue confirms compliance of the submitted documents with legal requirements, but does not guarantee the yield of the bonds and is not a recommendation for their purchase.