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KQ CEO Titus Naikuni stresses a point at a past event/ FILE

Kenya

Kenya Airways cleared for Sh20.7B rights issue takeoff

KQ CEO Titus Naikuni stresses a point at a past event/ FILE

NAIROBI, Kenya, Mar 9- National carrier Kenya Airways has received the green light to float a rights issue through which it is planning to raise a whopping Sh20.7 billion.

This will be the biggest rights issue in Kenya yet and it will also see some 1.47 billion ordinary Kenya Airways shares on offer under the rights issue.

“The Capital Markets Authority (CMA) has approved a Sh20.7 billion rights issue for Kenya Airways to enable the airline meet its additional capital requirements related to acquisition of additional aircraft,” said CMA Chief Executive Officer Stella Kilonzo.

KQ is expected to release full details of what the transaction entails on Monday next week.

If realised, the money will enable the carrier to fund its ambitious route and fleet expansion plans. In its quest to become Africa’s premier carrier with a footprint in every nation in Africa in the next ten years, KQ plans to double its fleet by 2015.

Kenya Airways is also set to acquire nine new Boeing 787 Dreamliners over the next few years to enable it effectively operate long haul flights and in regions such as Far East, North Asia and Southern America.

“The Authority has reviewed the disclosures made by Kenya Airways in the Information Memorandum in accordance with the Capital Markets (Securities) (Public Offers, Listing and Disclosures) Regulations, 2002, and is satisfied with the requirements,” added Kilonzo.

In February this year, the carrier appointed Crested Stock Securities from Uganda and Orbit Securities Company to join the transaction team that will steer the planned rights issue slated for November this year.

Kenya Commercial Bank will be the receiving bank while CFC Stanbic is the lead transaction adviser. Scanad and Ogilvy PR will be the advertising and public relations advisors respectively.

The government, which holds a 23 percent stake in the carrier, has already set aside Sh5 billion indicating its intent to take up its rights.

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The other major shareholder Air France-KLM with a 26 percent share has also confirmed that it will also take up its rights.

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