Kenya Airways (KQ) has started selling tickets for non-stop flights between Nairobi’s Jomo Kenyatta and New York’s John F. Kennedy airport that will start on October 28, ahead of the 2018 US winter season.
The ultra-long flights from JKIA to JFK (15-hour KQ002 23:25 – 06:25 next day) and return leg (14-hour KQ003 12:25 – 10:55 next day) will be operated using two Boeing 787-8 Dreamliners, and an extended crew of 4 pilots and 13 flight attendants on each leg.
KQ welcomes its first Dreamliner in April 2014
KQ Chairman, Michael Joseph said this was a significant event after long planning and extensive interaction with US authorities (11 different agencies in the US are involved) while CEO Sebastian Mikosz said that they were targeting two main groups of flyers – corporate (48 US companies and international organizations that have their regional hubs in Nairobi) and premium leisure tourists (the USA is a top tourist source for Kenya that had 95,000 visitors between January and October in 2017, which was a 20% increase over the last two years).
Kenya Airways is investing heavy with daily flights to New York (85,000 seats each way per year) that they estimate will have significant uptake, similar to the airline’s current routes to Europe (~85% loads) due to the attractiveness of non-stop flights between Nairobi and New York and they expect that the USA flights will constitute up to 10% of the airline’s revenue after 2019. The KQ Boeing Dreamliners seat 234 passengers – 30 in business class (tickets start at $2,499) and 204 in economy class (tickets start at $869).
In future, the airline will take back two other B-787 from Oman Air when the leases expire in 2019 and they also plan to sign a joint venture code-share with Delta Airlines in 2019 to expand the sale of tickets in the USA beyond New York.
Yesterday, officials from the Central Bank (CBK) and the Kenya Deposit Insurance Corporation (KDIC) met depositors of Chase Bank too outline the way forward following the offer deal between the State Bank of Mauritius (SBM) and the CBK for the acquisition of selected assets and liabilities of Chase Bank that is still in receivership.
Peter Nduati, the founder and CEO of the Resolution Group, and a Chase Bank customer tweeted some highlights from the Nairobi meeting.
- At the #Chasebank depositors meeting. CBK Governor briefing on the back story.
- SBM will take a maximum of Staff and Branches. There is no compulsion on the part of the staff to move.
- Moratorium deposits will have 75% of the money move to SBM out of which 50% will have ready access in a current account whilst the balance remains at 7% interest
- CBK says operationalization is a matter of weeks as far as depositors are concerned. Loans may take 2 months.
- To paraphrase, we will lose 25% of the deposit but will get 37.5% immediately. 37.5% will be availed in 3 annual tranches with a 7% interest.
- Its a better position for depositors but not optimum. At least 37.5% will be available and the balance will be in a term deposit earning interest.
- For a collapsed bank, I guess it’s the best deal. We have waited almost two years.
- Non-moratorium depositors move to SBM.
- I haven’t seen him (Zaf) or Duncan since 2016. Are they here even?
As part of the continued restructuring since CDC invested in the company in 2016, ARM Cement is selling its non-cement subsidiaries for $16 million to reduce the debt of the company and strengthen its position in its core cement business.
A shareholder’s extraordinary general meeting on January 22 is expected to green light the disposal of its industrial minerals business, fertilizer business (to Mavuno Fertilizer), its silicates business to ARM Energy and its mining business to ARM Minerals.
After the transactions, the companies will cease to be subsidiaries of ARM and be owned as:
- ARM Minerals and Chemicals (will be 100% owned by 100% by Mavuno fertilizers), which will be 51% owned by Omya (Schweiz) AG and 49% by Pinner Heights Kenya.
- ARM Energy: will be 100% owned by Pinner Heights Kenya.
Pinner Heights is owned by a trust set up for the benefit of ARM’s long-time Managing Director and key man, Pradeep Paunrana who owns 11% of ARM Cement, and his immediate family. A leasing company Vaell has sought an injunction stop the transactions and repossess vehicles leased to ARM Cement, but ARM has objected in court as the assets are not part of the non-cement business being sold.
Elsewhere, a UK firm Exotix has issued a warning on Kenya cement company valuations with the view that the listed cement companies are overvalued due to high prices of clinker, foreign exchange losses and exposure of Kenyan companies to cheaper imports unlike their peer companies in neighbouring countries. Exotix recommends price downgrades of Bamburi Cement (by 2% from the current share price of Kshs 180), ARM Cement (by 22% from Kshs 13) and East African Portland Cement Company (by 32% from Kshs 27).
$1 = Kshs 103.
Today, the Pambazuka National Lottery (PNL) followed partner Sportpesa in suspending its operation in Kenya following a new 35% tax that came into force on January 1, 2018.
PNL, which is operated by Bradley Limited, interpretation of the tax change is that, whereas they had been paying out 55% out as prizes and 25% as a tax to charities, the new 35% tax makes operations impossible as their tax costs will be 115% before deducting any operating costs.
PNL was established in 2016, and the suspension announced on January 7 will allow any winners of prizes to claim them up to April 7, 2018. The Pambazuka statement reads that “operating any lottery under this framework is not possible and therefore business operations are forced to close” but, as with Sportpesa, who had become arguably the leading betting company in Kenya, but who cancelled all local sports sponsorships last week, there is no mention of what the numbers actually are i.e revenue and taxes (in dollars or shillings), to compare how they were faring before the tax, to how unsustainable business will be under the new tax.
EDIT PNL’s directors say they had invested over two billion shillings (~$19.5 million) and employed over 500 people.
From a Kenyan magazine issue – The Weekly Review in September 1985.
The Receiver & Manager of Kenatco offered for sale the business and assets of the two businesses – haulage and taxis, either together or separately as going concerns. This meant the businesses were operating, and receiver/managers are usually appointed by financial institutions to take over what they see as struggling businesses that are having trouble paying their bank debts, but which could be turned around with better management. Banks do this before the businesses shut down completely. The Kenatco businesses were:
- Haulage Comprising: 85 haulage trucks of various makes including Mack, Fiat, Mercedes, Leyland, and Volvo and 90 trailers of various makes including Vibert, York, and Miller.
- Taxis: comprising 79 Mercedes-Benz 200 Saloon Car Taxis – petrol and diesel-powered.
- The two businesses shared land including two leasehold plots – at Likoni Road, Nairobi (5.9 acres) and Changamwe Industrial Area, Mombasa (7.9 acres). Also on sale were service & administration vehicles, workshop plant & equipment as well as office furniture & equipment.
A document giving full particulars of the business and assets for sale was made available and could be obtained at a cost of Kshs 300/ – (refundable in the event of a successful purchase of the assets) from J .K. Muiruri, Joint Receiver and Manager, Kenatco Transport Company, Ltd., Alico House, P.O. Box 44286, NAIROBI Tel. 721833.
Offers were to reach the Receivers and Managers by 30th November 1985, and conditions were that the Receivers and Managers did not bind themselves to accept the highest or any tender for the businesses, and offers for individual assets would not be entertained.
A separate notice was also issued for the sale of other assets of Kenatco – which were surplus vehicles, equipment and scrap items that were not part of the “going concern” sale. The assets were located in two towns with offers due on October 19, 1985, and the receivers & managers described them as:
Nairobi (Likoni Road)
- Administration Vehicles: 6 Peugeot 404 pickup escort vans (1979/1981), Mazda 929 KVV 404, (1980), 2 Toyota Carinas – KRB150/KRB151 (1977), Peugeot 104 AB38ll (1979).
- The scrap items included 395 tyres, 117 scrap iron sheets, 56 batteries, 24 fibre glass fuel tanks, 2 safes, 2 steel fuel tanks, 13 tarpaulins and 19 empty oil drums.
- Spare parts for Chevrolet, Datsun, Land Rover, Volkswagen, Toyota, Renault, and Mercedes vehicles.
- 2 Peugeot 404 pickup escort vans, Toyota Carina KRA 910 (1977), Mercedes-Benz 200D KPL 251,
- Yamaha motorcycle 100cc KTD 207 (1979), Boss forklift KND 686.
- The scrap items included 468 tyres, 141 batteries (1979), 48 oil drums and 7 tonnes scrap metal (1973).
Other Kenatco articles:
- Excerpt about the company: KENATCO, a cooperative with 9,000 members was very successful with profitable routes to Zambia, Angola, and Rhodesia until East African problems led to them not being allowed to carry heavy vehicle freight through Tanzania, and that government’s detention of one-third of their fleet.
- This article gives the background and history of Kenatco. The Kenya National Transport Co-operative Society, as it was named in 1965, was the first transport business society in Kenya…The Kenatco pioneers had a big dream. So big, that they not only wanted to go into the haulage business, but also to buy some tourism boats and a plane to serve the local tourism market.
- See the Hansard from Kenya’s parliament on 26 November 2008 that describes how the Kenatco receivership came about.
- Kenatco is still under receivership. In 2016, Receiver Manager John Ndung’u said that finance costs are driving the company into losses, even though it has been making an operating profit since 2002.
- Kenatco still exists as a Kenatco Taxis Ltd. a fully fledged government parastatal wholly owned by ICDC. It is Kenya’s leading, most reliable value-for-money taxi company, with a clean and modern fleet, efficient back-office infrastructure, on-the-road back up services, for that comfortable and safe drive, pick up and drop off at whichever location within Kenya.