Kenya Airways (KQ, Nairobi Jomo Kenyatta) has secured a KES5 billion Kenyan shilling (USD49.46 million) loan from its largest shareholder, the Kenyan Government. According to a company statement issued on February 28, the funding has been extended on commercial terms and will be used in the overhauling of the carrier's E190 fleet.

"The cash injection will cater for overhaul of 11 Embraer engines which is required every eight years in order to uphold the highest levels of safety and maintain reliability and planned network schedules," it said.

Airline chairman Michael Joseph added that Kenya Airways would also look into refurbishing its remaining pair of B737-700s. The two jets, which the ch-aviation fleets module shows are leased from Cross Ocean Partners Management LP, were originally due to be phased out under previous chief executive Sebastian Mikosz.

"The refurbishment will guarantee our passengers a better experience on their flights with us. The airline commits to prudent utilisation of the funds to ensure value for money," Joseph said.

Kenya Airways is on track to be renationalised this year in a move that will enable the loss-making national carrier to more effectively compete with regional state-owned rivals, such as RwandAir and Ethiopian Airlines. Aside from the change in ownership, Kenya Airways is also undergoing a restructuring drive aimed at reducing its overall costs while boosting its operational efficiencies.

"As a strategic national asset and key driver of Kenya's economic development and GDP growth, it is important that the airline continues to operate optimally," newly-appointed Kenya Airways Group Managing Director and CEO Allan Kilavuka said.

"It is on this premise that this year, we identified six key areas of focus which are - Improving our customer's experience, reducing costs and wastage, strengthening operational efficiency, stabilizing the organization, growing our profitability and managing relationships with our stakeholders. Various initiatives are already in place and progressing well across these focus areas. We are grateful to the Government for walking this journey with us, and I would like to thank the KQ team that work tirelessly every day to provide a delightful experience for all our customers."

One of the more difficult reforms that will have to be pushed through is a reduction in headcount. Last year, the airline undertook to restructure its supply chain and facilities department following 1H19 audits that revealed mass inefficiencies and cost overruns. However, in late February, the Nairobi High Court ordered management to halt plans to sack over 70 contract workers pending a hearing on April 2. According to The Star newspaper, until such time that a hearing has been held and a ruling handed down, the staff will remain on the airline's payroll.