Investor offers planes in exchange for Kenya Airways strategic stake

An investor has proposed supplying aircraft to Kenya Airways (KQ) in exchange for an equity shareholding as the company pursues external funding for its operational restructuring. The proposal comes as the airline evaluates options to rebuild capacity and modernise its existing fleet.

The national carrier relies on fresh capital to expand network coverage and support long-term operational recovery. Kenya Airways Board of Directors recently approved an investor memorandum, clearing the way for a formal selection process to evaluate interested parties.

Management confirmed that multiple local and international investors have expressed interest in participating in the recapitalisation exercise. Because the carrier is listed on the Nairobi Securities Exchange (NSE), executive leaders noted that single-sourcing is prohibited, requiring a competitive procurement process.

The airline aims to increase its total fleet from 42 aircraft to 60 by 2030. Achieving this target requires adding 18 aircraft over the next four years through direct purchases, leasing agreements, or asset-backed equity deals.

The search for strategic backing occurs amid significant financial pressures. Kenya Airways reported a net loss of KSh16.08 billion for the six months ending June 30, 2026. This figure represents an increase from the KSh12.15 billion net loss recorded during the corresponding period in 2025.

Rising operational expenses have countered top-line growth. Fuel costs rose by 72 per cent during the first half of 2026, driven by global supply disruptions, with fuel accounting for nearly half of total operational expenditures.

Despite these cost pressures, total turnover reached KSh81.2 billion for the six-month period, up 9 per cent from KSh74.5 billion in 2025. Cargo operations provided additional support, generating KSh8.8 billion in revenue, an 18 per cent increase year-on-year.

The carrier continues to carry a debt load of approximately KSh152 billion, with nearly 90 per cent owed to the Government of Kenya. Total liabilities stood at KSh315.2 billion against total assets of KSh183.2 billion at the end of the previous financial period.

The National Treasury, which holds a 48.9 per cent controlling stake in the carrier, informed Parliament that it targets concluding a deal by December 2026. The proposed transaction aims to raise between $1.5 billion and $2 billion in fresh capital.

The International Monetary Fund (IMF) and Kenyan lawmakers have repeatedly called for an end to direct state subsidies, urging the government to secure private equity. Treasury officials confirmed that direct cash injections will cease once a strategic investor is onboarded.