Kenya Airways proposes State-run structure as airport bid fails

11th June 2019

By: Bloomberg

  

Font size: - +

Kenya Airways is willing to operate under a State-owned holding company after the troubled airline failed in its bid to jointly run the country’s main airport, according to chairperson Michael Joseph.

Lawmakers in the East African nation in May rejected the airline’s proposal to operate Jomo Kenyatta International Airport with the state-owned Kenya Airports Authority, and are expected to issue alternative proposals, Joseph said in an interview Monday. The recommendations could include the partial nationalization of Kenya Airways, he said.

The airline, which reported a 5.95-billion shillings ($59-million) full-year loss, is proposing a model similar to Emirates Airline and Ethiopian Airlines Enterprise, which operate as units of State-owned holding companies. Such an arrangement would enable it to double its fleet in five years, Joseph said.

“We need the financial structure to enable us to do that,” he said. “It might not be cash, it might be the balance sheet which is why the airport deal was very important for us.”

Kenya Airways, which is 48.9%-owned by the government, is also on the hunt for a chief executive officer after Sebastian Mikosz said he would step down before the end of his three-year contract.

“A mature, seasoned executive is what I will hire,” Joseph said. “There’s not many around. If it’s delayed beyond December there’ll be still strong leadership.”

The airline’s stock fell 5.6% in Nairobi on Monday, bringing the loss this year to 60%.

Edited by Bloomberg

Comments

The functionality you are trying to access is only available to subscribers.

If you are already a subscriber, you can Login Here.

If you are not a subscriber, you can subscribe now, by selecting one of the below options.

For more information or assistance, please contact us at subscriptions@creamermedia.co.za.

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION