Tewolde Gebremariam to Play Key Role in Potential Sale of Kenya Airways to Delta Airlines











The Kenyan delegation, led by President William Ruto, recently met with officials from Delta Airlines in Washington to discuss a potential sale of Kenya Airways, the national carrier of Kenya. Tewolde Gebremariam, the former Group CEO of Ethiopian Airlines, who is now a senior strategy adviser for Delta, was also present at the meeting. Gebremariam is an expert in African aviation and may play a key role in the negotiations between the two airlines. According to data from the African Airlines Association, Ethiopian Airlines carried 7,053,000 passengers in 2021, while Kenya Airways carried only 1,489,000. Ruto expressed his desire to sell the struggling Kenya Airways, which posted a loss of around $80 million in the first half of the year. The CEO of Kenya Airways, Allan Kilavuka, stated that no decisions have been made regarding the potential sale and that the government is exploring all options to address the airline’s financing needs.

If Delta were to accept the proposal and acquire the government’s 48.9% stake in Kenya Airways, it would be the largest shareholding by a US carrier in a foreign airline. The other shareholders include a consortium of local lenders (38.1%), Air France-KLM (7.8%), and minority shareholders (2%). A deal would give Delta a stronger presence in Africa and more options for distributing traffic between Asia and the US. On the other hand, a deal for Kenya Airways is important in light of the changing competition landscape and Qatar Airways’ ongoing attempt to acquire a 49% stake in RwandAir.

According to the international stock market and financial news website Market Screener, Delta’s current largest shareholding is AeroMexico, of which it owns 20%. Delta also holds 9% of China Eastern Airlines, 2.86% of Air France-KLM, and 2.94% of LATAM, in addition to shares in other non-airline entities. Delta’s competitor, United Airlines, owns 8.04% of Azul, while American Airlines holds 5.83% of China Southern Airlines.

It is still early to tell if Delta will accept President Ruto’s proposal and how much of Kenya Airways it will ultimately agree to. The specifics of any potential deal will be determined by transaction advisers on both sides. Delta will be conducting due diligence to determine what it considers to be a fair value for a stake in Kenya Airways. While it comes with higher financial obligations, a controlling stake in the carrier would give Delta more leverage in negotiating issues such as headcount reduction. The issue of Kenya Airways’ existing debt would also need to be resolved. One possible option could be for the government to take it off the balance sheet to strengthen the airline’s financial position.

Regardless of the outcome, the sale of Kenya Airways would mark a significant shift in the African aviation industry. It would also have wider implications for the region’s economy, as the airline plays a crucial role in connecting Kenya to the rest of the world. The government will need to carefully weigh the potential benefits and drawbacks of a sale and make a decision that is in the best interests of the country and its citizens.



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