, NAIROBI, Kenya. Nov 5 – Kenya Airways has planned to renegotiate its loans with its lenders as they seek to improve their balance sheet.
The Chairman Michael Joseph says this is part of the new strategy that seeks to bring the airline back to profitability.
Joseph says the firms’ Chief Executive Mbuvi Ngunze will take charge of the renegotiations.
“We need to continue this process of strengthening our balance sheet by renegotiating some of our debt with our financiers. All these things are happening at the moment and therefore Mbuvi as the Chief Executive is vital for that project,” he added.
The airline has been going through financial turbulence and has since sold a five acre piece of land and some aircrafts.
The firm made a new loss of Sh4.7 billion in half year ended September 30, 2016, a marked improvement from the 11.9 billion shillings it posted same period last year.
In the half year ended September 30, 2016 the airline received a one off cash injection of Sh1.7 billion from sale of assets and a bridge loan of Sh9.8 billion from Government of Kenya.
In the period under review, the airline’s cost of borrowing went up to Sh3.8 billion.
The African Export – Import (Afrexim) Bank last year agreed to lend the airline Sh20 billion as a bridging loan to ease its cash flow constrains and has already received about Sh10 billion.
The government also bailed out the airline with Sh20 billion in March 2016 to help the firm through its financial crisis.