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Kenya Airways, Nairobi airport to merge

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Nairobi Jomo Kenyatta International Airport Kenya Airports Authority

State-run national flag carrier Kenya Airways plans to merge with Nairobi Jomo Kenyatta International Airport (JKIA) to compete with other state-owned carriers in Africa and the Middle East, such as Ethiopian Airlines and Emirates Airline.

“The deal should be completed by the end of the year, which is gaining an instrument against competition,” Kenya Airways CEO Sebastian Mikosz told ATW.

The two state-controlled companies are being brought together under one holding. “This move will help us grow our Nairobi hub,” Mikosz said.

JKIA, which is managed by state-owned Kenya Airports Authority KAA, will be owned and managed by a holding company that will be 100% owned by Kenya Airways. JKIA employees will be taken over by the holding company.

Mikosz said the holding is expected to bring efficient operations between JKIA and Kenya Airways, including controlling aviation-related businesses such as ground handling, fuel distribution, catering and slot coordination.

ATW understands Ethiopian Airlines uses a similar model at its hub at Addis Ababa Bole International Airport.

SkyTeam member Kenya Airways operates in a very competitive environment. However, Mikosz said its financial restructuring plan has paid off significantly. “But it has not ended the process of healing Kenya Airways,” he said. “We must continue to fix revenue and cost issues, among many other necessary measures.”

Kenya Airways’ ownership now comprises 48.9% by the government, 38.1% by local banks, 7.8% by KLM and 5.2% by other shareholders.

According to KAA, JKIA handles more than 40 passenger and 25 cargo airlines.

Atw

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