Friday, July 19, 2024

Foreign investor to acquire 49 percent stake in Kenya Airways in equity deal

The national carrier Kenya Airways is anticipating to close a deal with a foreign investor who will acquire up to 49 per cent in the airline before the end of year 2024.

This has been revealed by the airline chief executive officer Allan Kilavuka in a interview with a local television.

“We are looking for an equity investor that can invest up to a maximum of 49 per cent,” said Kilavuka. “This is the maximum because the rules and regulations in Kenya do not allow you to have a Airline Operating Certificate (AOC) if you have more than 50 per cent foreign ownership.”

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The move will mean that the new foreign investor will automatically become the majority shareholder at Kenya Airways.

Currently, the government stands as the majority shareholder with a 48.90 per cent stake, followed by KQ Lenders Company 2017 Limited with a 38.09 per cent stake, Dutch airline KLM with a 7.76 per cent stake, Kenya Airways employees with a 2.44 per cent stake, while the remaining shares are spread across other 7 shareholders.

Kenya Airways cuts full year net loss from Sh. 38 billion to Sh. 22.7 billion

NCBA

“The ideal investor will be the one who gives us the capitalization that we are looking for,” said Kilavuka.

The current government has been keen to sell of the national carrier. In December 2022, President William Ruto met with top executives of the United States largest carrier Delta Air to discuss a potential sale during a trip to the United States.

This meeting followed President Ruto’s remarks that his government was willing to have a strategic investor take over the ailing national carrier.

NCBA

“I’m willing to sell the whole of Kenya Airways Plc. I’m not in the business of running an airline that just has a Kenyan flag, that’s not my business,” President Ruto had told Bloomberg News on the sidelines of the US-Africa Leaders Summit in Washington DC.

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