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Kenya’s government is reviewing its partnership with Air France-KLM in Kenya Airways Ltd., which needs about $600 million to recover after posting a record loss, Treasury Secretary Henry Rotich said.
The state may increase its shareholding in the airline if a capital injection “dilutes shares” of other principal shareholders, Rotich said in an interview Wednesday on Citizen TV, a Nairobi-based broadcaster. Any additional funding would include a mixture of debt and equity and would depend on a turnaround strategy expected from the airline’s management soon, he said.
It’s “difficult for Kenya Airways to borrow long-term” because of the loss it made, Rotich said.
Kenya Airways, sub-Saharan Africa’s third-largest carrier, said July 30 it will borrow $200 million and sell assets after posting a dull-year loss of 25.7 billion shillings ($255 million), the biggest in the nation’s corporate history. The shares have dropped 19 percent since the announcement to the lowest level in almost 13 years.
This article was written by David Malingha Doya from Bloomberg and was legally licensed through the NewsCred publisher network.