Aviation Authority receives JKIA PIIP from Kenya Airways

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The Kenya Airports Authority (KAA) on Wednesday received a Privately Initiated Investment Proposal (PIIP) from Kenya Airways PLC requesting that the airline be granted a concession to operate, maintain and develop the Jomo Kenyatta International Airport (JKIA).

According to the PPP Act, a PIIP is defined as a proposal that is originated by a private party without the involvement of a contracting authority and may include information that enables a complete evaluation of the proposal as if it were a bid.

In that regard, KAA’s Managing Director Jonny Andersen revealed that the Authority’s Board of Directors and the Management will consider the proposal on the basis of the guidelines within the PPP Act, which incorporates the requirement of public participation.

“As our valued stakeholders, it is mandatory and important that we get the views and feedback of all relevant stakeholders on the proposals made by KQ in the PIIP,” said Mr. Andersen in a statement.

In the PIIP, Kenya Airways PLC has proposed to form a Special Purpose Vehicle (SPV) specifically dedicated to operating, managing and developing JKIA for a period of 30 years. An SPV is a subsidiary of a company which is protected from the parent company’s financial risk. It is set up under conditions set out in Section 59 of the Public Private Partnerships (PPP) Act.

In order to ensure a seamless transaction, KAA also revealed that they would contract advisers to guide them in the process.

  “The Board of Directors and Management of KAA therefore appointed Transaction Advisers to advise it on the PIIP, including carrying out a comprehensive due diligence and evaluation of the PIIP,” said Mr. Andersen, KAA’s MD said

In the following weeks, KAA will host several public participation forums with different stakeholders in line with Article 174 of the Constitution of Kenya, which enhances the participation of the people in the exercise of the powers of the State and in making decisions affecting them.

Due to the unique interests of the different airport stakeholders, the Authority will hold separate forums or engagements for different stakeholders to enable effective engagement and ensure that the respective concerns of different stakeholders are incorporated.

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