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DALLAS – The Air France-KLM Group (AF/KL) has reduced its investment in Kenya Airways (KQ) to improve sustainability and performance.
The Air France-KLM Group now has a 7.76% share in KQ after reducing its stake in the African airline at the end of last year. This was confirmed in the airline group’s 2023 annual report. The airline group now views its investment in Kenya Airways as a financial asset, which Kenyan publication The East African says could be sold off if the need arises.
According to the Group, it "has no significant influence on Kenya Airways and, due to its strategic intention, it is regarded as a financial asset at fair value through other comprehensive income under IFRS 9.”
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Air France–KLM Stake in Kenya Airways
The group’s investment in the Kenyan carrier has significantly been diluted from a controlling stake of 26.7% to 7.76 %. This comes after the Kenyan government and a group of local banks converted their debts into equity as part of a financial restructuring plan to rescue the airline from insolvency in 2017.
Kenya Airways has been dealing with financial issues for quite some time. As part of its strategy to restructure the national airline, Kenya’s government took over part of the airline’s debt. Kenya's National Treasury settled US$47 million of Kenya Airways' debt during the fourth quarter of 2023, clearing over 50% of the national carrier's guaranteed debt.
Air France–KLM Group’s Strategic Plans
According to the East African, Air France-KLM is currently implementing a restructuring plan that includes reassessing its growth plan to become more sustainable. The plan aims to help the group improve performance and competitiveness while also improving cost management and revenues.
With a desire to play a more significant role in European aviation, Air France-KLM announced in October last year that it would take a stake in Scandinavian Airlines (SK). The airline group will take a non-controlling stake in the share capital of the reorganized SK.
This is one of the key components of the Group’s strategic roadmap. Air France-KLM is determined to play an active role in the consolidation of European aviation. The envisaged cooperation with SK is one of the components of its strategic roadmap.
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Exploring Airline History Volume I
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David H. Stringer, the History Editor for AIRWAYS Magazine, has chronicled the story of the commercial aviation industry with his airline history articles that have appeared in AIRWAYS over two decades. Here, for the first time, is a compilation of those articles.
Subjects A through C are presented in this first of three volumes. Covering topics such as the airlines of Alaska at the time of statehood and Canada's regional airlines of the 1960s, the individual histories of such carriers as Allegheny, American, Braniff, and Continental are also included in Volume One. Get your copy today!
December 2024
