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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 12 months, the native inventory change says, because the troubled nationwide provider 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 world air journey.
“The extension of suspension seeks to allow the corporate [to] full its operational and company restructure course of,” the Nairobi Securities Trade mentioned in a press release on Wednesday.
— NSE PLC (@NSE_PLC) January 4, 2023
Final month, Kenyan President William Ruto mentioned the federal government was able to promote its whole stake within the airline, which has been deep in debt for years.
The federal government owns a 48.9 % stake in Kenya Airways whereas Air France-KLM has 7.8 %. The remainder is owned by non-public homeowners 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 operating an airline that simply has a Kenyan flag – that’s not my enterprise,” mentioned Ruto, who reportedly met executives from US provider Delta Air Traces in the course of the journey.
Kenya Airways’ woes worsened in November when pilots staged a days-long strike, which led to a whole lot of flight cancellations and stranded hundreds of passengers. It additionally defaulted on a $525 million mortgage from the US Export-Import Financial institution final 12 months.
The shares had been first suspended two and a half years in the past as lawmakers had been contemplating a plan – since dropped – for the state to take full possession of the provider.
The airline, whose slogan is “The Delight 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 saying a $447 million mortgage for Kenya beneath a 38-month help programme
The IMF mentioned “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 gas prices. It was a marked enchancment on the $94.6 million loss within the interval the 12 months 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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