Kenya Airways secures $350m state loan to shore up finances
Government also agrees to restructure existing loans to SkyTeam carrier in addition to fresh loan.
Kenya’s government is to provide a KShs45.15 billion ($350 million) shareholder loan to national carrier Kenya Airways, as well as agreeing to restructure KShs122 billion of existing loans.
The SkyTeam carrier disclosed the fresh funding initiatives in a stock market announcement.
Kenya Airways says the fresh loan will enable the carrier to meet “immediate and non-deferrable operational obligations”, as well as supporting continuity of operations as it implements its broader turnaround plan.
“The facility is earmarked to support the company’s critical operational requirements, including aircraft
maintenance, the return to service of grounded aircraft and other immediate critical operational
obligations,” the airline says.
The government also holds an option to convert the proposed loan, which is repayable over a 10-year period, into equity as part of a future capital restructuring.
The Kenyan state has also approved the conversion of existing shareholder loans of approximately
Kes122 billion, together with accrued interest, into an “equity-qualifying tradeable instrument”.
“The proposed conversion is intended to restore the company from its current negative equity position
to a positive equity position, strengthen its balance sheet and creditworthiness,” the airline says.
This will support Kenya Airways’ planned long-term capital raise initiatives.
Kenya Airways has been working to improve its financial position with the goal of securing a strategic investor. While the carrier secured its first profit in a decade in 2024, supported by currency gains, it fell back to a loss in 2025 – in part hampered by the unavailability of a number of aircraft due to ongoing engine and supply chain issues.
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