Kenya is seeking to sell KQ to a foreign strategic investor
Treasury Principal Secretary nominee Chris Kiptoo has told MPs the government will push for a fresh equity investor who is expected to invest capital and offer management expertise in the next step of restructuring of Kenya Airways.
In this move, the Treasury will seek a foreign strategic investor to buy a controlling stake in Kenya Airways as a path of returning the national carrier to profitability.
If the sale goes through, it will see the State reduce its shareholding from 48.9 percent and cut the ownership of lenders who converted their debt to a 38 percent stake.
Photo: Courtesy// Treasury Principal Secretary nominee Dr Chris Kiptoo before MPs during vetting at County Hall yesterday.
The previous administration had pushed for the restructuring of the carrier on the back of the multi-billion shilling bailout after dropping the nationalisation plan which did not however actualize as planned.
Mr Murkomen, the Cabinet Secretary for Roads, Transport, and Public works told Parliament that the State would not convert its debts or bailout cash into shares.
“We do not want to cross the 50 percent shareholding because we want KQ to remain a privately owned company,” he said. “We have to ask ourselves why KQ is in the situation it is currently. It is because of mismanagement of project Mawingu, but there is a restructuring process currently underway,” Murkomen said.
Photo: Courtesy// KQ Boeing 777-200 ER in action
KQ recorded a ninth consecutive half-year loss, sinking it Sh15 billion deeper into a negative equity position. It has also been surviving on State bailouts since the Covid-19 pandemic.
KQ however reported a Sh9.8 billion loss in August, a better performance than the Sh11.48 billion loss it recorded in the same period a year earlier. It also recorded a further Sh5.3 billion loss on hedged foreign exchange differences, driving its total comprehensive loss to Sh14.9 billion.