NAIROBI, Kenya, Jun 20 – Kenya Airways (KQ) has listed 1.03 billion new shares at the Nairobi Securities Exchange (NSE) following the Rights Issue in April that raised Sh14.48 billion out of an intended Sh20.7 billion.
Speaking at the launch of the trading of the new shares, Ministry of Finance Permanent Secretary Joseph Kinyua acknowledged that the Rights Issue will help KQ finance their 10-year growth plan as they hope to add to their air fleet, while enhancing their ability to leave their footprint on the global market.
“Kenya Airways is seeking to grow its fleet from the current 34 planes to 119 aircraft, which includes 12 cargo freighters by 2021,” he revealed.
“It also plans to increase the number of destinations from the 56 presently to 115 during the same period, which is in line with KQ’s ambitions to be the premier airline connecting Africa with the rest of the world,” he added.
The listing of an additional 1,034,853,551 shares will catapult the market capitalisation of the airline by an estimated Sh13.8 billion, moving it from 27th to 12th on the NSE.
KQ Chairman Evanson Mwaniki announced that they met their minimum target for the Rights Issue despite a challenging economic environment, and he revealed that although the total Kenyan shareholding of KQ has dropped nearly eight percent to 55.24 percent, the airline was still able to retain its national carrier designation.
“The Rights Issue was the culmination of a discussion we had internally as we sought to raise financing for our 10-year growth plan through which we will acquire addition aircrafts and expand our destination network to enhance our global footprint,” he explained.
“The Board of Kenya Airways opted for an equity call to complement debt financing in the initial phase of an ambitious $3 billion (Sh250.5 billion) expansion programme,” he stated.
The government is now the biggest shareholder of KQ and Kinyua explained that they decided to invest heavily into the new shares because they have confidence in KQ and they believe that it’s an investment that is good for the whole country.
NSE Vice Chairman Bob Karina said that the Rights Issue was also executed on the Uganda Securities Exchange (USE) and the Dar-es-Salaam Stock Exchange (DSE) so by effect of cross listing, all the issued shares of Kenya Airways are available on all the respective markets.
“The lessons learned during the transaction will prove invaluable in facilitating the integration of the East African capital markets and boosting the seamless trading of cross listed shares,” he noted.
“The NSE and the Central Depository and Settlement Corporation, together with the DSE and the USE wish to assure the shareholders of Kenya Airways that they stand ready to facilitate the trading of their shares in the markets in which they are listed,” he added.