Five airlines express interest in buying majority stake in KQ

BRUSSELS

Five airlines have expressed interest in buying a majority stake in the cash-strapped national carrier Kenya Airways.

Transport and Infrastructure Cabinet Secretary James Macharia yesterday said the proposals by the airlines would be studied.

In the meantime, he said the government would restructure the airline to turn around its fortunes before bids to buy it could be considered.

“It is true there are firms from the Middle East and America that have expressed interest in Kenya Airways. None of these has firmed up interest so I cannot give you details,” he said during an interview in Brussels.

Mr Macharia is accompanying President Kenyatta, who is attending the EU development day meeting, which ends today.

The Cabinet Secretary was careful on the effects of any formal announcement about the airlines buying off KQ.

“Kenya Airways is a publicly listed company, which means there could be sudden interest in its shares,” he said.

Aviation sources say Qatar Airways is one of those that have expressed interest in KQ because it wants to use the Jomo Kenyatta International Airport hub to solidify its operations in Africa.

Others said to have expressed interest in the national carrier are Abu Dhabis’s Etihad Airlines, Oman Air and US-based Omni Air.

Alarm bells started ringing in the aviation industry in March, 2015 when KQ announced a loss of Sh28 billion.

This marked the beginning of efforts by its directors and the government to stem off the turbulence facing the airline.

As part of revenue-raising and cost-cutting measures, the airline sold its early morning landing slot at London’s Heathrow Airport for Sh7.5 billion to Oman Air.

The proceeds were shared with its partners Air France and Dutch KLM.