Kenya’s government has approved $350 million in shareholder financing for Kenya Airways to help the struggling national carrier meet urgent financial obligations as it pursues a broader restructuring and searches for strategic investors.
The approval was announced on Friday by President William Ruto’s office, with the government remaining the airline’s largest shareholder.
The funding comes as Kenya Airways continues to face financial pressure and seeks fresh capital to stabilise its operations and strengthen its balance sheet.
Alongside the financing package, Kenya’s Cabinet has endorsed a proposal to convert 122 billion Kenyan shillings (approximately $941 million) in government loans owed by the airline into an equity-qualifying tradable instrument.
The proposed restructuring forms part of Kenya Airways’ efforts to reduce its debt burden and improve its financial position. The airline has also been considering converting principal debt owed to the government and a consortium of local banks into equity.
The measures are intended to support the carrier’s recovery as it works to attract strategic investors and secure additional funding.
According to the President’s office, the $350 million financing will be disbursed in batches under the supervision of the Ministry of Finance.
The funding arrangement will have a repayment period of up to 10 years, with the possibility of converting the financing into equity, subject to the necessary approvals.
The latest intervention highlights the government’s role in supporting Kenya Airways as the airline works to address its financial obligations, restructure its balance sheet and establish a more sustainable path forward.
