The Capital Markets Authority (CMA) has extended a share trading freeze on national carrier Kenya Airways for an additional year just days after the National Treasury announced a Sh34.9 billion bailout of the cash-strapped airline.
KQ, as the carrier is known by its international code, had its shares initially suspended from trading on the Nairobi Securities Exchange (NSE) in July 2020 after MPs began to review a law that would allow the government to take over the loss-making airline, a bid that was later dropped in December 2021.
“Notice is hereby given on the extension of suspension from trading of Kenya Airways Plc shares. The extension of suspension seeks to enable the company complete its operational and corporate restructure process,” said NSE in a statement on Wednesday.
“The extension of suspension from trading the company’s shares will remain in force for an additional 12 months, with effect from January 5, 2023.”
Before its suspension from trading at the NSE, the airline’s share was trading at Sh3.83. The share price represents a premium given that KQ’s liabilities exceed its assets.
The government owns a 48.9 percent stake in the ailing carrier while Air France-KLM owns 7.8 percent.
The airline was privatised in 1996 when the government sold a 26 percent stake to KLM and a further 22 percent to local shareholders through an initial public offering at NSE, but has sank into debts and losses since 2014.
The company has over the years received multibillion-shilling State bailouts adding onto the taxpayer’s pain amid a rapid surge in the cost of living.
In December last year, President William Ruto made a pitch to sell a controlling stake in the carrier to US investors as part of efforts to return the struggling airline to profitability.
