Kenya Airways shares suspended for another year | Air News
Stocks in the debt-ridden airline haven’t been traded since 2020, and the president says he wants to sell the government’s money.
Trading in Kenya Airways shares has been suspended for another year, the local stock exchange says, as the troubled national carrier struggles to return to profitability.
The airline’s shares have been suspended since July 2020 amid the COVID-19 pandemic, which has devastated global air travel.
“The extension of the ban is aimed at enabling the company [to] complete its operational and corporate restructuring process,” the Nairobi Securities Exchange said in a statement on Wednesday.
— NSE PLC (@NSE_PLC) January 4, 2023
Last month, Kenyan President William Ruto said the government was ready to sell its entire stake in the airline, which has been in debt for years.
The government owns a 48.9 percent stake in Kenya Airways and Air France-KLM holds 7.8 percent. The rest are owned by private owners and banks.
“I am willing to sell all of Kenya Airways,” Ruto told Bloomberg News during his visit to the United States as Kenya’s president.
“I am not involved in running an airline that has only the Kenyan flag – that is not my business,” said Ruto, who reportedly met with officials from US carrier Delta Air Lines during the visit .
Kenya Airways’ deficits worsened in November when pilots staged a day-long strike, leading to the cancellation of hundreds of flights and stranding thousands of passengers. It also defaulted on a $525 million loan from the US Export-Import Bank last year.
The shares were first suspended two and a half years ago as lawmakers considered a plan – since dropped – for the state to take full ownership of the group. conduct.
The airline, with the slogan “The Pride of Africa”, was founded in 1977 after the collapse of East African Airways and now flies over four million passengers to 42 destinations annually .
But it hasn’t made a profit since 2012, and the government has pumped in millions of dollars to keep it afloat.
Last month, the International Monetary Fund called for progress on structural reforms in Kenya while announcing a $447 million loan for Kenya under a 38-month support program.
The IMF said that “addressing vulnerabilities” at Kenya Airways as well as the majority state utility Kenya Power was “urgent”.
In August, the airline reported a half-year loss of $81.5 million, citing high fuel costs. It was a significant improvement on the $94.6 million loss in the year-ago period.
Local media reports cited a letter from Treasury Cabinet Secretary Njuguna Ndung’u to the IMF at the end of December stating that Kenya Airways will receive additional state aid of approximately $280 million in the near future.