NAIROBI – Kenya Airways has finished restructuring $2-billion of debt, the carrier said on Wednesday, completing a key part of its turnaround plan after heavy losses.
That figure includes full commitments to financiers and operating aircraft leasing companies, which are not normally reflected in the balance sheet, he said.
As part of its assistance to the company’s revival efforts, the government also offered contingent guarantees for $750-million of the airline‘s debt for 10 years.
“We will pay less now to allow us a bit of time to reshape the business to pay a bit more on the tail end,” Ngunze said, referring to the debt restructuring.
Kenya Airways, which is part owned by Air France KLM, posted the country’s biggest ever annual corporate loss of 26-billion shillings ($251-million) in its 2016 financial year, hit by a slump in travel and high financing costs after buying new Boeing planes.
The losses pushed the company into negative equity of 45-billion shillings in its financial year to the end of March.
Ngunze said he expects to move into positive territory next year after the restructuring.
The financial restructuring diluted all existing shareholders by 95 percent.