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Kenya Airways: Minority Shareholders Support Financial Restructuring

Kenya Airways: Minority Shareholders Support Financial Restructuring

 

Boeing 787 Dreamliner. Photo Credit: Boeing

Kenya Airways has secured the backing of its minority to issue more shares and convert some debt into equity, it said on Monday, despite the opposition of some local lenders.

The heavily indebted carrier said in June the financial plan would help cut debt, reduce finance costs, and help it stay afloat after years of losses.

The airline wants 11 local banks to convert their debt into shares through a special purpose vehicle, which will become the second largest shareholder when the restructuring is completed.

To do this the airline will increase the number of shares in issue from 1.5 billion to 7 billion, board adviser Mbuvi Ngunze told a news conference after a special meeting where small shareholders backed the plan.

But some local banks had filed a court case objecting to the plan to turn their debt into equity, he said.

 

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