Kenya’s National Treasury has unveiled plans to launch an international expression of interest to attract a strategic foreign investor for Kenya Airways, in a deal that could inject between $1.2 billion and $2 billion into the struggling national carrier.
Treasury Cabinet Secretary John Mbadi said the government is seeking a partner capable of providing substantial equity capital alongside operational expertise to stabilise and reposition the airline. He emphasised that the new investor must bring not only financial resources but also proven experience in managing successful airlines.
The move forms part of Kenya’s commitments under its programme with the International Monetary Fund to reduce state exposure to loss-making enterprises and attract private capital into key sectors. Kenya Airways has struggled with profitability for more than a decade, despite repeated bailouts and debt restructuring initiatives.
As part of preparations for the deal, the government has assumed and continues to service significant debt on behalf of the airline. Mbadi disclosed that existing state loans, including obligations taken over under previous restructuring arrangements, could be converted into equity once a strategic partner is secured. This approach is intended to clean up the balance sheet and make the airline more attractive to investors.
Kenya Airways’ financial position remains fragile. The carrier recently posted a half-year loss of Sh12.15 billion for the period ending June 2025, reversing a brief return to profitability recorded in 2024. Its liabilities significantly exceed its assets, leaving it in a negative equity position and underscoring the urgency of fresh capital injection. Operational setbacks, including the grounding of aircraft for extended maintenance, have compounded revenue pressures.
The government is exploring the least disruptive restructuring framework within existing financial, lease and regulatory agreements. While earlier proposals had linked the airline’s revival to infrastructure upgrades at Jomo Kenyatta International Airport, officials have not confirmed whether airport assets will form part of the current investor package.
Kenya Airways, often branded “The Pride of Africa,” plunged into insolvency in 2018 following an aggressive expansion drive that left it burdened with heavy debt. Since then, it has relied on sustained government support, including debt-for-equity swaps involving local banks that significantly altered its ownership structure and reduced the stake of former strategic partner Air France-KLM.
Despite its financial struggles, the airline remains central to Kenya’s economic and aviation ambitions, serving as a key link between East Africa and global markets. The Treasury believes that securing a credible strategic investor could help rationalise routes, optimise fleet deployment, improve productivity and potentially position the carrier within a broader pan-African aviation group structure.
Market reaction to the investor search has been cautiously optimistic, with renewed interest in the airline’s shares on the Nairobi Securities Exchange. However, analysts warn that attracting a credible equity investor willing to commit billions of dollars will require clear incentives, a stable regulatory environment and a convincing long-term turnaround plan.
As the government prepares to roll out the international expression of interest, the success of the process will likely determine whether Kenya Airways can finally achieve a sustainable turnaround after years of financial turbulence.
