Correction; We previously wrote that Sh 77 Billion was a new loan, however that is not the case but the government was guaranteeing the airline’s debt (Sh 77B).
The Kenyan Government has agreed to act as a guarantor for Kenya Airways’s Sh77 billion debt which was taken from US Based Export-Import Bank and a group of local banks.
The cabinet, which met last week also approved the conversion of the Government’s Sh4.2 billion loan into equity, a move that would likely see the Govt increase its shareholding in Kenya Airways.
The gurantee request by the airline is however expected to go through a final approval by the national assembly in the interest of tax-payers whereby the Government owns 29.8 percent.
Kenya Airways few days ago released its results for the full year to March reporting a net loss of KSh 10.2 Billion, which was not as bad as a net loss of KSh 26.2 Billion reported in the same period last year.
The new CEO, Sebastian Mikosz last week took over from Mbuvi Ngunze with high expectations to help in restructuring the airline just as he had done at LOT Polish Airlines.
Share Price
Kenya Airways Share price on Monday’s trading session closed at Sh. 6.75, up by 45 percent since the beginning of February this year.
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