Kenya Airways is in advanced discussions with multiple potential investors as it seeks to restructure its balance sheet and address a negative equity position that stood at KSh131 billion at the close of 2025.
Speaking on the ongoing process, Chief Executive Officer Capt. Kamal said the airline is engaging a number of investors across different strategic options, with discussions having reached what he described as “good stages.”
“We are at good stages in the discussions with a few investors,” said Capt. Kamal.
According to the CEO, the airline is deliberately pursuing a multi-pronged investment approach, with prospective partners exploring different forms of participation in the business.
“Some investors are scouting for an equity stake, some are scouting for debt injection, and some are scouting for fleet augmentation with aircraft,” he said.
Capt. Kamal noted that combining these different forms of support into a single strategic solution would be more effective than relying on one approach.
“Having a mix of these options as the strategic investment as opposed to a standalone approach will support the airline,” he said.
He added that the airline is not considering a single model for its turnaround.
“It is not a single approach being considered. You cannot take a single model and operate on that,” he said.
The CEO indicated that Kenya Airways is seriously considering onboarding a consortium of investors to help stabilise its financial position and support operational growth.
“The key thing here is that the airline is seriously considering a consortium of investors to step in and help cure the balance sheet,” he said.
Capt. Kamal added that securing the strategic investment is urgent, particularly as the airline looks to increase flight frequencies across its network.
“The strategic investment is needed as soon as possible to allow KQ to increase frequency,” he said.
Debt Burden and Capital Structure
Chief Financial Officer Mary Mwenga said the airline is focused on achieving an optimal capital structure as it navigates a heavy debt load.
As of 2025, Kenya Airways held total debt of KSh146 billion, with about 90 percent, or KSh131 billion, attributable to the Government of Kenya.
“The airline is in pursuit of an optimal capital structure,” Mwenga said.
She confirmed that the government debt carries an option for conversion into equity, although timing remains a key constraint.
“The Government of Kenya debt indeed has an option of conversion to equity, but timing was the issue here,” she said.
Mwenga indicated that any debt-for-equity conversion by the government is likely to be deferred until after the airline secures a strategic investor.
“Any debt-for-equity conversion by GOK will have to wait for the airline to secure the strategic investment. It was an option but timing was the issue here,” she said.
Finance Costs Continue to Weigh on Earnings
Kenya Airways’ financial performance continues to be weighed down by high financing costs, which stood at KSh12 billion in 2025. These costs have significantly squeezed earnings, underscoring the urgency of restructuring the airline’s capital base.
Reducing the cost of capital remains a key priority, particularly as the airline seeks to return to sustained profitability while navigating a competitive and cost-sensitive aviation market.
Lender Obligations and 2027 Convertible Note
The airline is also engaging lenders over obligations tied to KQ Lenders Company, which holds a significant stake in the business.
Mwenga said discussions are ongoing regarding a 10-year convertible note that is due to mature in November 2027.
“The sunset date is November 2027 and before then, the tripartite discussions between KQ, the Government of Kenya, and the banks are ongoing on how to treat this maturity,” she said.
She added that the airline has already begun engagement to avoid last-minute pressure as the maturity date approaches.
“Discussions are already underway because the airline does not want this to get to November 2027 before resolution,” Mwenga said.
Strategic Importance and Outlook
Kenya Airways remains a key player in regional connectivity and international travel, with its performance carrying broader implications for trade, tourism, and business travel in Kenya and across Africa.
The outcome of the ongoing investor discussions is expected to shape the airline’s financial and operational trajectory, particularly as it seeks to rebuild capacity and strengthen its balance sheet.
A consortium-based investment structure could offer a more flexible and comprehensive solution, combining capital support with operational and asset expansion, as the airline works toward long-term sustainability.
