Adani Airport Holdings, a company that is part of an Indian conglomerate known as the Adani Group is proposing to takeover the Jomo Kenyatta International Airport.
The Adani Group, whose entity wants to takeover Kenya’s JKIA, is not a company with a very clean name if previous reporting is anything to go by. In 2023, the New York financial firm Hindenburg Research called the Adani Group the largest con in corporate history. The research firm alleged that the Adani Group had engaged in a long-running stock manipulation and accounting fraud scheme.
At the same time, a report that appeared in local media stated that Adani has been subject to multiple government investigations that have alleged the Indian company as being involved in corruption and money laundering.
Hindenburg Research further alleged that family members of the Adani family have used offshore shell companies to create illegitimate revenue for the mother company, and siphon money from the mother company’s publicly listed arms.
The company however denies these allegations, labeling them as untrue. The conglomerate describes itself as being a diversified organization that comprises of ten publicly traded companies. The company is headquartered in Ahmedabad.
In the proposal to takeover the JKIA, Adani Airport Holdings claims that it will invest Sh. 246 billion ($1.85 billion) to expand and upgrade the JKIA. This expansion and upgrade will allegedly include the construction of a second runway and a new passenger terminal.
Sh. 99.6 billion ($750 million) will be used to develop a new passenger terminal, a taxiway system, two rapid exit taxiways, and an associated apron. These will be completed by the year 2029, Adani claims.
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In addition, Sh. 12.2 billion ($92 million) will be used to improve the taxiway network system, develop two additional rapid exits, and develop remote aircraft parking stands. These will be completed in 2035, Adani claims.
All this will be done under a Build-Operate-Transfer (BOT) model for a period of thirty years. Within this 30 year period, Adani will be expected to earn at least an 18 per cent annual turnover.
At the same time, during the 30-year period, Adani will be entitled to determine and impose charges in US dollars on airlines and other users for services at Kenya’s main airport. “[Adani will] be free to determine to determine and collect charges for non-aeronautical and any other commercial activities without any restrictions,” the company states in its submissions.
The proposal had been kept secret by the government through the Kenya Airports Authority (KAA) until it was leaked to the public.
It was only after the leakage and the issue becoming part of demonstrations that the KAA came out to admit that indeed it had received a proposal from the Indian company to takeover one of Kenya’s most prestigious possessions.
In justifying the proposal, KAA claimed that the airport was built in 1978 and has aging infrastructure that is a threat to Kenya’s regional competitiveness. “KAA received an investment proposal under the Public Private Partnership Act 2021… [for] an investment in a new passenger terminal building, second runway, and refurbishment of the existing facilities at [the airport],” said KAA.
Though KAA claimed that what it had was just a proposal, it went ahead to state that staff working at the airport will not lose their jobs with the entry of the Indian company. KAA went on to state that the expanded airport will be good for business – in what appeared to be a foregone conclusion for an impending takeover of the airport by Adani.
“I wish to assure our staff that no jobs are at risk. I also wish to assure the airport business community and operators that the expanded facility will create business opportunities and attendant benefits,” KAA’s acting chief executive officer Henry Ogoye said.
