Hundreds of million dollars in fresh capital is to be sought by Kenya Airways in the next step of a restructuring that has seen it dispose of aircraft and announce a 15% cut in staff.
The Nairobi-listed airline’s share price is down almost 90% in five years.
An ambitious expansion plan collapsed in the face of falling tourist arrivals to east Africa’s largest economy as terrorism and the Ebola virus scared people away
Chief executive, Mbuvi Ngunze, told the Financial Times that the size of the capital raising “was still being worked out” and would be announced next month.
But he added: “Nirvana would be to go to the market with a lesser requirement” than the $300 million-$400 million being discussed by analysts.
“There’s already quite some interest in [Kenya Airways] because of our unique hub position, our investment in Africa. So people have come to the table with different ideas.
“We will have to take those ideas, looking at what our requirement is, and decide what works for us.”
The loss-making airline has sold two Boeing 777-200s and subleased two 787s and three 777-300s, which will save almost $8 million a month.
A prized early-morning take off and landing slot at Heathrow was sold to Oman Air for $75 million.
Six hundred redundancies and redeployments among the 3,800-strong workforce were announced last month.
The airline’s main shareholders are the Kenyan government, with 29%; Air France-KLM (26%), and the International Finance Corporation (9.7%).
Ngunze hopes all three will contribute to the capital raising.
The airline has made a loss in each of the past three years, including $255 million in the year to March 2015, the largest in the country’s corporate history.