Kenya Airways shareholders have approved a financial restructuring plan to create new shares and convert debt into equity at a special meeting on Monday, Business Daily Africa reported.
The plan is essential for the debt-ridden airline to continue operating and return to profit, Michael Joseph, chairman of the board, told shareholders before they voted overwhelmingly to back the plan.
Kenya’s national carrier, Kenya Airways (KQ) had earlier revealed it was set to renegotiate a pact it agreed with Royal Dutch Airlines KLM in 1995 regarding the control and directorship of the airline as KQ undergoes a restructuring process.
Prior to the restructuring plan, KLM and Kenyan Airways were the two single largest shareholders of KQ and both steered the affairs of the airline.
However, the new structure in place will see 11 banks, who are owed about Sh23 billion ($221 million) by KQ, take over the airline as well as hold a seat on the company’s board.