Kenya Airways has received government approval for a US$350 million (approximately KSh45.15 billion) shareholder loan to support its operations and ongoing financial restructuring.
In a public announcement dated October 9, 2026, the airline said the funding would help it meet immediate financial obligations, maintain operational continuity and advance its plan to return to sustainable profitability.
The loan will support critical needs, including aircraft maintenance, the return to service of grounded planes and other urgent operational expenses.
The facility will have a repayment period of 10 years and, subject to the necessary approvals, may be converted into equity at the government's option as part of a future capital restructuring. Alternatively, the loan may be repaid earlier under terms agreed upon by the government and the airline.
The government has also given in-principle approval for the conversion of existing shareholder loans worth approximately KSh122 billion, together with accrued interest, into an equity-qualifying tradable instrument.
Kenya Airways said the proposed conversion is intended to address its negative equity position, strengthen its balance sheet and improve its creditworthiness.
The move is also expected to support future capital-raising efforts and the search for suitable strategic partners and investors.
However, the implementation of both measures remains subject to further negotiations, formal transaction agreements and the required corporate, shareholder and regulatory approvals.
These include approvals or confirmations from the Capital Markets Authority and the Nairobi Securities Exchange, alongside other applicable statutory requirements.
The airline has cautioned shareholders and the investing public to exercise care when trading in its securities until the outstanding terms of the proposed restructuring are finalised and formally announced.
Kenya Airways said it would provide further updates as the process progresses and material details become available.
The announcement was signed by Acting Group Managing Director and Chief Executive Officer Habib Waswani on behalf of the board.
