Shares within the indebted airline haven't been traded since 2020, and the president says he needs to promote the federal government’s stake.
Buying and selling in Kenya Airways shares has been suspended for an additional yr, the native inventory alternate says, because the troubled nationwide service battles to return to profitability.
The airline’s shares have been suspended since July 2020 within the midst of the COVID-19 pandemic, which devastated international air journey.
“The extension of suspension seeks to allow the corporate [to] full its operational and company restructure course of,” the Nairobi Securities Change stated in an announcement on Wednesday.
— NSE PLC (@NSE_PLC) January 4, 2023
Final month, Kenyan President William Ruto stated the federal government was able to promote its total stake within the airline, which has been deep in debt for years.
The federal government owns a 48.9 p.c stake in Kenya Airways whereas Air France-KLM has 7.8 p.c. The remaining is owned by non-public house owners and banks.
“I’m prepared to promote the entire of Kenya Airways,” Ruto informed Bloomberg Information throughout his first go to to america as Kenya’s president.
“I’m not within the enterprise of working an airline that simply has a Kenyan flag – that’s not my enterprise,” stated Ruto, who reportedly met executives from US service Delta Air Strains in the course of the journey.
Kenya Airways’ woes worsened in November when pilots staged a days-long strike, which led to a whole bunch of flight cancellations and stranded hundreds of passengers. It additionally defaulted on a $525 million mortgage from the US Export-Import Financial institution final yr.
The shares have been first suspended two and a half years in the past as lawmakers have been contemplating a plan – since dropped – for the state to take full possession of the service.
The airline, whose slogan is “The Satisfaction of Africa”, was based in 1977 after the demise of East African Airways and now flies greater than 4 million passengers to 42 locations yearly.
But it surely has not made a revenue since 2012, and the federal government has pumped in hundreds of thousands of dollars to maintain it afloat.
Final month, the Worldwide Financial Fund referred to as for progress on structural reforms in Kenya whereas asserting a $447 million mortgage for Kenya below a 38-month assist programme
The IMF stated “addressing vulnerabilities” at Kenya Airways in addition to the bulk state-owned utility Kenya Energy was “pressing”.
In August, the airline reported an $81.5 million half-year loss, citing excessive gasoline prices. It was a marked enchancment on the $94.6 million loss within the interval the yr earlier than.
Native media stories cited a letter from Treasury Cupboard Secretary Njuguna Ndung’u to the IMF on the finish of December as saying Kenya Airways would get an extra state bailout of about $280 million quickly.
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