Kenya Airways to receive Ksh 45.4 billion in government financing

The Kenyan Cabinet has approved Ksh 45.4 billion in new financing to support the recovery and turnaround of the national carrier, Kenya Airways. The funds are intended to address urgent operational costs, specifically aircraft maintenance and the return of grounded planes to service.

The financing will be disbursed in installments under the supervision of the National Treasury, featuring a repayment period of up to 10 years. There is also an option to convert the funds into equity, subject to necessary approvals.

In a further move to strengthen the airline’s balance sheet, the Cabinet approved a proposal to convert Ksh 122 billion in existing government loans and accrued interest into an equity-qualifying tradable instrument. This restructuring aims to improve the carrier's ability to attract additional capital and resolve debt issues that have previously hindered investor interest. The intervention is intended to safeguard an airline that contributes more than $1.3 billion annually to Kenya’s GDP through trade, tourism, and regional connectivity.