Government Seeks Foreign Investor for Kenya Airways in Fresh Turnaround Plan

President William Ruto's administration has forged a new plan to rescue Kenya Airways (KQ) from it's financial woes - one that involves bringing in foreign investors to help get the national carrier back on its feet.

Treasury Cabinet Secretary John Mbadi has confirmed that the government was thinking of putting out an international Expression of Interest (EOI) to try and find the right partner. And the new partner is expected to make the much needed cash injection, estimated between Sh154.8 billion and Sh258 billion.

A Big Cash Injection On The Cards

According to CS Mbadi, the new investor will have to put in at least a minimum of Sh154.8 billion and could go all the way up to Sh258 billion. The government is going to put out an international expression of interest to see who is interested in coming in as a strategic partner - it's a matter of waiting until that happens.

The government has already taken on Sh63.1 billion of Kenya Airways debt, which it's currently paying off under an on-lending agreement. And then there's the possibility that it later turns that debt into equity, once the strategic investor is secured.

Another Shot At Privatization

This is the second time President Ruto's administration has tried to go down the foreign partner route for Kenya Airways.

It was back in December 2022 when President Ruto met up with some top decision makers from Delta Air Lines in the United States. He made some public comments then about being open to selling the airline off, and sparked a heated debate about whether that was a good idea.

What the government is looking to do is secure partnerships that turn Kenya Airways into a profitable airline - it doesn't matter whether it's still state-owned or not. The talks with Delta were pretty preliminary back then.

Operations And Finances Going Downhill Fast

The government is now trying to get back in the game as things are getting pretty tough for Kenya Airways.

The airline recently reported a net loss of Sh12.15 billion in the first half of the 2025 financial year - a pretty big shift from the Sh5.4 billion profit it made in the full year 2024 and the Sh513 million profit it made in the first half of 2024.

Part of the problem has been the grounding of some of its Boeing 787 Dreamliners - turns out that there's a global shortage of spare parts. This has unfortunately affected both capacity and revenue.

A Complex Ownership Structure - And Some Weighty Regulations

Back in 2024, former CEO Allan Kilavuka said the organization was looking to make up to 49 percent equity available for sale to foreign investors - because of the aviation regulations, that mean't a majority local stake had to stay in the business if the airline was going to keep its operating certificate.

As at December 2024, the government had a 48.90 percent stake in Kenya Airways. And then there are the other shareholders:

• KQ Lenders Company 2017 Limited - 38.09 percent

• KLM - 7.76 percent

• Kenya Airways employees - 2.44 percent

• Other minority shareholders - everything else

What Next?

The search for that strategic investor is a sign that the government is serious about turning Kenya Airways' fortunes around - fresh capital and maybe new expertise could be just what the airline needs.