NSE suspends trading of Kenya Airways shares
Nairobi Securities Exchange (NSE) has suspended the trading of Kenya Airways Plc share effective July 3. 2020.
The suspension which will stay in force for three months is due to the imminent buyout of Kenya Airways by the government.
“Notice is hereby given on the suspension from trading of Kenya Airways Plc shares.” Said NSE adding that “this follows the publication of National Management Aviation Bill 2020 on June 18.”
Kenya Airways applied for the suspension from trading and closure of its register, until the resolution of its future is determined, according to the statement from the NSE,
NSE presented the application to the Capital Markets Authority (CMA) pursuant to section 11(3)w of the CMA Act for approval.
KQ Takeover Bill
The bill to nationalize KQ was tabled Tuesday before National Assembly by the Chairman of the Transport Committee, Pokot South Member of Parliament, David Pkosing.
Under the Bill, the government, which owns 48.9 percent of KQ, is expected to buy out the remaining holders of 51.1 percent of the shares and form an Aviation Holding Company to run the national carrier and Kenya Airports Authority (KAA), which manages airports in the country.
An Aviation Holding Company has been formed to run the national carrier and Kenya Airports Authority (KAA), which manages airports in the country.
The bill followed last year’s adoption of a report by the August House to re-nationalise KQ in a bid to revitalise the loss-making national carrier.
KQ will, as a new outfit, carry a new share capital of Ksh.7.5 billion upon nationalization should the August House approve the Bill.
In its May financial year report, KQ dipped further into a full year net loss of KSh. 12.985 billion in the year ending December 2019 compared to KSh. 7.558 billion reported in the previous year.
The airline blamed the loss on a 12.4 percent increase in operating costs, following an increase in its fleet operation costs.
This, the airline said was associated with a 15 percent increase in capacity deployed to offer increased connectivity between city pairs and investment in new routes.
Its total revenue increased by 12.4 percent to Kshs.128.317 billion in 2019 from Kshs.114.185 billion in 2018.