NAIROBI — Kenya Airways, sub-Saharan Africa’s third-largest airline, is planning a 70-billion shilling ($690m) restructuring that includes reducing its fleet and cutting the number of staff, CEO Mbuvi Ngunze has said.
The carrier, based in the capital Nairobi, has been working on a turnaround plan after reporting the largest loss in Kenyan corporate history last year.
The carrier plans to raise 40-billion shillings through debt and equity funding as part of its strategy, Mr Ngunze said in an interview aired on Wednesday on Citizen TV in Nairobi.
“Do we need to rationalise our staff? Do we look at opportunities to reduce costs? Yeah,” he said. “We will be totally sensitive with this as this is an emotive issue, but certainly, there will be some hits.”
The carrier has sold two Boeing 777-200 aircraft and will sell two more, and it is searching for carriers to sublease four of its Boeing 777-300 jetliners for a period of four or five years.
A reorganisation plan developed by advisers McKinsey seeks to return the company to profit and may result in its 4,000-strong workforce being reduced by at least 30%, according to Eric Musau ofStandard Investment Bank.
Kenya’s government, which owns 28% of the carrier, has said it will help bail out KQ, as the national airline is widely known.
Source: Business Day