Parliament on Tuesday questioned the relationship between President Uhuru Kenyatta’s family businesses and the controversial plan to have the management of JKIA taken over by national carrier Kenya Airways (famously known by its NSE ticker KQ)
REVEALED: Kenyatta family’s interests in takeover of JKIA
More wealth for the Kenyatta family if deal goes through
The Public Investment Committee noted that there was likely to be conflict of interest in the deal which will see Kenya’s main airport managed through a publicly-traded company.
In 2018, President Kenyatta appointed Isaac Awuondo as the chairman of KAA.
Awuondo, is also the Managing Director of Commercial Bank of Africa (CBA) where Kenyatta is a major shareholder alongside his mother Mama Ngina and his brother Muhoho.
CBA is also a major shareholder at Kenya Airways after the national airline turned several loans taken from local banks into shares.
CBA Group equity from the debt restructuring stands at Sh3.1 billion, while NIC (which has recently merged with CBA) has shares worth Sh2.1 billion.
During the negotiation of some of the loans, the CEO of CBA Kenya was Jeremy Ngunze whose elder brother Mbuvi Ngunze served as KQ CEO between 2014 and 2017.
Equity Bank has Sh5.2 billion, National Bank Sh3.5 billion, Co-operative Bank (Sh3.3 billion, DTB Sh2.1 billion and while KCB Group has Sh2.1 billion.
KAA CEO John Andersen
On Tuesday, MPs sitting in PIC pressured KAA CEO John Andersen to confirm allegations of powerful forces pushing for KQ to be handed over the strategic airport.
“I cannot speculate on the reason behind the deal or the faces behind it. We were approached by Kenya Airways on this matter and also got a Cabinet memo seeking that we manage the process,” Andersen responded cautiously.
To further complicate the deal, it emerged KQ already had a Sh3.8 billion debt owed to Kenya Airports Authority, meaning if the deal goes through, the debtor will own the lender.
Currently, KAA has an estimated annual revenue of Sh7 billion which goes directly to Treasury given it is a parastatal.
In the change of deal, the profits made by KQ will be distributed to shareholders – many of them unknown with the exception of the government and KLM which have a 13.71 per cent stake and 46 per cent respectively.
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