Companies
KQ eyes Treasury signal for new turnaround plan
Thursday September 09 2021
Summary
- The plan submitted by UK consultancy firm Steer Group last month suggests the most viable options of revamping the airline in the face of deepening financial losses.
- KQ chairman Michael Joseph Wednesday confirmed that the report was complete and awaiting approval by the Treasury.
- Crafting a viable turnaround strategy for KQ was one of the conditions for the Sh255 billion loan to the government from the International Monetary Fund (IMF) in March.
A proposed new turnaround strategy for Kenya Airways is awaiting approval by the Treasury even as the airline hopes for improved fortunes in the medium term.
The plan submitted by UK consultancy firm Steer Group last month suggests the most viable options of revamping the airline in the face of deepening financial losses and depressed passenger numbers.
KQ chairman Michael Joseph Wednesday confirmed that the report was complete and awaiting approval by the Treasury. He did not discuss the report’s content.
Crafting a viable turnaround strategy for KQ was one of the conditions for the Sh255 billion loan to the government from the International Monetary Fund (IMF) in March.
In the loan deal, Kenya committed to audit and reform the operations of nine key State-owned enterprises (SOEs) to ensure their viability.
These are Kenya Airways, the Kenya Airports Authority, the Kenya Railways Corporation, the Kenya Power and Lighting Company, the Kenya Electricity Generating Company, the Kenya Ports Authority, and three of the largest universities.
For Kenya Airways, the government committed to hiring an independent consultant to audit the airline and find the cheapest way of restructuring it.
As the airline awaits the Treasury’s word on the recommended reforms, it continues to ride turbulent times amid suppressed business.
The…