The government will overhaul the board of directors of Kenya Airways at the airline's annual general meeting tomorrow, Transport Cabinet Secretary James Macharia has said.
Macharia said several directors will be replaced by fresh blood to drive the recovery of the airline following a series of losses in the last two years.
The CS is, however, optimistic that KQ, which incurred a record loss of Sh26 billion in the last financial year is on the recovery path, and will do better next year.
"Kenya Airways was on its knees. But if you compare the results of March 2015 and March 2016, it shows improvement. In 2015 the operating loss was Sh24 billion. This year ended with an operating loss of just Sh4 billion. The reason the total loss was Sh25 billion was because of the financing issue, which has been resolved. We can project good results moving forward," Macharia said in an interview.
KQ board has 12 members excluding the alternate director representing the national Treasury. The government, which has a 30 per cent stake and is the major shareholder of the airline, is demanding more seats on the board. It currently has two representatives – Treasury Principal Secretary Kamau Thugge and his Transport counterpart Irungu Nyakera.
Only two women – Wanjiku Mugane and Caroline Armstrong-Ogwapit (both non executive directors) – sit on the board, which is chaired by Dennis Awori who joined last October.
A Senate report issued last December after a probe on KQ recommended the board be overhauled and previous directors questioned over the poor business strategies at the airline that have been blamed for the losses.
Last year, Treasury CS Henry Rotich, while appearing before the Senate committee probing the airline, hinted at management and board changes as a pre-requisite to a government financial support plan.
Kenya Airline Pilots Association has also attributed KQ's woes to mismanagement and recommended the sacking of top managers to make turnaround plans effective.
On Monday, the airline's CEO Mbuvi Ngunze told Reuters news agency that KQ is in talks with three or four institutional investors and airlines to buy a stake in KQ.
Sources have told the Star that one of the strongest bidders is Qatar Airways.