KQ is the subject of fierce competition between Temasek Holdings, state investors from Singapore and Qatar Airways, an airline that is owned by the Qatar Government. The two state-owned agencies are seeking to secure a deal with Kenya’s national carrier.
KQ, which has been struggling after a loss-making streak for decades, is seeking for different solutions for its problems, with the ultimate decision resting with the Kenya Government.
Temasek Holdings is proposing to acquire a 90% majority stake in KQ through a fresh capital injection, leaving the Kenya Government with a minority stake of 10%.
Qatar Airways, on the other hand, wants to sign a comprehensive management agreement, involving the airline bailing out Kenya Airways and supporting a new restructuring plan that will involve new investments, potentially receiving compensation through a share of future profits and exclusive management of Jomo Kenyatta International Airport(JKIA).
According to Dedan Maina, an investment insider, while the Singapore authority has denied entering into any negotiations with the Kenya Government over the KQ deal, this does not mean it has not submitted any bids.
“While Temasek Holdings has denied reports claiming its interest in taking a stake in Kenya Airways, this is a mitigation strategy to keep details private until the best bid is agreed upon, Benchmark NCBA style,” said Maina.
The Kenya Government, meanwhile, said to be reviewing both proposals in addition to having formal and informal discussions, weighing the benefits of retaining national control against the need for strategic investments and expertise.
After a brief recovery, Kenya Airways plunged back into a KSh 12.15 billion half-year net loss in 2025, with its balance sheet still littered with negative equity and huge debts.
Kenya Airways Shareholding Structure
Kenya Airways has the Government holding a 48.9% majority stake after converting billions that the airline owed it into equity. A special purpose vehicle, KQ lenders controls 38.1% after a consortium made up of 10 local banks converted some KSh 23 billion of debts into equity.
Temasek Holdings, Singapore’s state-owned Investment firm, is the majority owner of Singapore Airlines, while Qatar Airways is wholly owned by the Qatar Government through Qatar Investment Authority.
The Singapore Investor seeks to take control of Kenya Airways, considered a national asset, the sale of such a huge stake to a foreign entity bound to set off fierce political heat and opposition.
Qatar is not interested in ownership but operational control and a share in any future profits that accrue to KQ. The Kenya Government is not selling its stake, like it has done with Kenya Pipeline Corporation and Safaricom, but partnering. This means that Qatar Airlines will only benefit if KQ experiences a turnaround in fortunes. However, the fine print is in the proposal to exclusively manage JKIA, Kenya’s largest airport and the gateway to East Africa.
KQ, which is state-owned, has struggled to recover from a decade of losses and has been unsuccessful in onboarding a strategic investor to help it re-capitalize and clear its debts.
The choice between privatising the airline and giving management and operational control to a foreign investor comes just a year after KQ Plc shares resumed trading at the Nairobi Securities Exchange(NSE) after almost a five-year suspension.
Even after KQ shares resumed trading at the bourse, there appears to be no end to the airline’s prolonged restructuring aimed at reviving its operations and plug a drain on state resources.
Kenya Airways, known for its slogan “The Pride of Africa,” was established in 1977 after the collapse of East African Airways. Today, it operates flights to 45 destinations and serves over five million passengers annually.
Despite these achievements, the airline has long struggled under a heavy debt burden, which multiple government bailouts and strategic partnerships have sought to alleviate.
The carrier’s ownership structure reflects its hybrid identity as both a national and commercial entity. The Kenyan government holds a 48.9% stake. Notably, around 75,000 individual investors collectively own 2.8% of the airline through the stock market, underscoring its role as a publicly traded company with deep national ties.
While the resumption of trading signals a positive step, analysts caution that KQ still faces significant challenges, including market competition and operational inefficiencies. Even with the resumption of trading and a clear path forward, the airline’s leadership appears to have failed to leverage its improved financial standing to restore its position as a leading player in African aviation.
For investors and stakeholders, the entry of Qatar and Singapore to Kenya’s aviation landscape offers a glimmer of renewed opportunity to participate in the future of one of Africa’s most iconic carriers.
The question now is which option will the Kenya Government take to enable KQ to fully capitalize, restructure its operations, modernise and expand as well as secure long-term stability.
ALSO READ: Kenya Airways Issues Profit Warning On Lack of Aircraft Spares
Leave a comment