Kenya Airways commenced talks with the government on Thursday, seeking help in coping with competition from foreign carriers operating flights to its Nairobi hub.
The airline is restructuring its finances to cut huge debts and reduce finance costs to help it return to profitability after years of losses.
The carrier accrued debts to buy new planes, only to be hampered by a slump in tourism due to frequent attacks in Kenya by militants from neighbouring Somalia, and as Gulf-based rivals ratcheted up competition.
“We started out these negotiations both with KAA (Kenya Airports Authority) and ourselves and the government to see how we can better protect us,” Kenya Airways Chairman Michael Joseph told reporters.
“We don’t want to close our airspace,” he added.
Some of the foreign competitors enjoy massive state support including subsidies, Joseph said, without providing names.
Stock unchanged on NSE
By close of Thursday’s trading on the Nairobi Securities Exchange, the company’s (KQ) share price was unchanged at KES 4.65. The counter recorded a turnover of KES 1.87 million from 399,700 shares traded.
The NSE All Share Index was up 0.75% whereas the NSE20 was down 0.17%.
The airline is part-owned by the state and Air France-KLM