Kenya Airways (KQ, Nairobi Jomo Kenyatta) has secured USD50 million in short-term loans from local commercial banks amid delays in a planned USD500 million capital raising via a strategic investor, Kenya's Business Daily newspaper reported.
The bridge financing, meant to cover urgent working capital needs such as spare parts and engine servicing, comes as the national carrier awaits government approval of its investment memorandum. The Kenyan government, which holds a 49% stake, must sign it off before the airline can launch its hunt for a long-term investor.
"We had hoped to close this in 2024, but are currently waiting for approval from the main shareholder," Group CEO Allan Kilavuka lamented at a presentation of the airline's financial results for the six months ended June 30, 2025. "We are not just sitting pretty, we have opted for bridge financing to help us in the current environment."
Kilavuka said the recapitalisation plan, targeting at least USD500 million, will be key to stabilising liquidity, funding fleet expansion, and diversifying revenue streams.
The airline slumped back into the red in the first half of 2025, posting a KES12.15 billion shilling (USD94 million) after-tax loss compared with a KES513 million (USD4 million) profit for the same period last year. Revenue fell by nearly 19% to KES74.5 billion (USD577 million), reflecting a 14% drop in passenger numbers and a 16% reduction in available seat capacity.
The airline said the first half of the year was marked by operational and financial challenges, including the temporary grounding of three B787-8s representing 33% of its widebody fleet due to global supply chain disruptions and engine availability constraints. One of the grounded B787-8s resumed service in July, with the remaining two expected to return to service later in the year.
Despite trimming costs by 4.6% to KES86.7 billion (USD671 million), Kilavuka said global supply chain constraints continue to weigh heavily. "Demand for original equipment spare parts is 10-20% higher than supply, with delivery disruptions affecting 40% of airlines," he noted.
Kenya Airways had expected to add four narrowbodies this year but managed to bring in only one B737-800, taking the Kenya Airways Group fleet to 42 planes, he said. This includes 33 aircraft at Kenya Airways plus nine DHC-8-Q400s at its low-cost subsidiary, Jambojet (JM, Nairobi Jomo Kenyatta).
Kilavuka added: "Our focus remains clear: restoring full fleet capacity, advancing cost optimisation, and completing our capital raising programme to strengthen our balance sheet. These measures will ensure we emerge stronger, leaner, and better positioned to deliver long-term value for our shareholders, customers, and partners."
According to the airline, the Kenya Airways fleet currently includes nine B737-800 narrowbodies; nine B787-8 widebodies; eleven E190 regional jets; and four cargo planes: two B737-300(SF) and two B737-800(SF).
