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Economy

KQ sends finance boss home, retires fleet chief

Mr Alex Mbugua, former Kenya Airways finance director. PHOTO | FILE
Mr Alex Mbugua, former Kenya Airways finance director. PHOTO | FILE 

National carrier Kenya Airways on Tuesday sent home its long-serving finance director, Alex Mbugua, in what was seen as part of a broader initiative to turn around the fortunes of the loss-making company.

Kenya Airways chairman Dennis Awori said Dick Murianki, who served as the general manager for the airline’s cargo business, had replaced Mr Mbugua in an acting capacity until a substantive finance director is recruited.

Rick Sine, the company’s fleet director, also left giving the clearest signal yet that execution of the Treasury’s intention to clear out the airline’s top management is underway.

Mr Mbugua served as the Kenya Airways’ group finance director for eight years having been appointed in July 2008.

Mr Murianki has worked in the airline industry for over 12 years and has served in various roles in Kenya Airways, including as a finance manager, commercial business performance manager and head of financial control. 

Prior to joining Kenya Airways, he worked with Ernst and Young Public Accountants for over eight years in accountancy and business consultancy roles.

He holds an MBA from Moi University and a Bachelor of Commerce degree from the University of Nairobi. 

Mr Mbugua’s exit is seen to be in line with Treasury secretary Henry Rotich’s announcement last September that Kenya Airways’ top managers were likely to lose their jobs before the government releases a proposed bailout package.

“We need to know what caused the loss before having the managers resign,” the minister told a joint Senate committee looking into the affairs of KQ.

The KQ management has been blamed for poor decisions that led to the airline posting a record Sh25.7 billion loss in the 2014/2015 financial year.

Mr Rotich told the Senate committee that the government had demanded major changes, including management restructuring as part of the turnaround plan.

KQ’s management is accused of making a series of poor decisions, including the ambitious Mawingu expansion project that led to excessive leasing of aircraft and left the company with a heavy debt load.

The government is considering a Sh60 billion bailout plan for KQ.

To keep the company afloat, the government has provided the airline with short-term support in the form of a Sh4.2 billion shareholder loan.

The amount is intended to help the airline meet its financial obligations, particularly paying off crucial creditors like fuel suppliers.

The carrier has received a Sh20 billion bridging facility from Afrexim Bank for working capital with the Treasury’s support.

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