Kenya approves $350 million financing for Kenya Airways to support restructuring and potential debt-to-equity conversion

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The government is the largest shareholder in the loss-making airline, which is seeking strategic investors as it looks for fresh capital.

Kenya Airways says part of its restructuring plan involves cleaning up its balance sheet, including the possible conversion into equity of principal debt owed to the Kenyan government and a consortium of local banks.

The Cabinet also endorsed a proposed conversion of Kenya Airways’ 122bn Kenyan shillings ($941m) in government loans into an equity-qualifying tradable instrument, Ruto’s office said in a statement.

The funds will be released in batches under the finance ministry’s oversight, with a repayment period of up to 10 years and the possibility of conversion into equity, subject to the necessary approvals.