MPs suspend sitting as KQ fails to table JKIA proposal

A parliamentary committee has adjourned its sitting for one hour after the loss-making Kenya Airways failed to table an investment proposal for the takeover of JKIA management from Kenya Airports Authority (KAA).

The National Assembly’s Transport committee was forced to suspend its sittings after Planning Principal Secretary Esther Koimett said she had no Privately Initiated Investments Proposal (PIIP) that KQ submitted to KAA on October 5, 2018.

Ms Koimett made the disclosure in the company of KQ managing director Sebastian Mikosz and KAA’s Johnny Andersen.

“I don’t have the proposal with me here. We can make arrangements for KQ to submit it within reasonable time. This can be done within an hour,” Ms Koimett told the committee chaired by David Pkosing.

Mr Pkosing demanded that the PIIP be tabled before the meeting can go on and proceeded to adjourn the sitting for an hour to allow KQ deliver the document.

“Since this is document that was sent to KAA, it is in a file somewhere and you can send a motorbike to deliver it here,” Moses Kuria, the committee vice chairperson said.

Mr Pkosing directed Ms Koimett to ensure that Transport Cabinet Secretary James Macharia attends the meeting in person when the session resumes at midday.

KQ demanded access to confidential Kenya Airports Authority (KAA) data and critical IT systems two days before it tabled the proposal to take over management of the Jomo Kenyatta International Airport (JKIA).

The national carrier, known by its international code KQ, equally demanded unfettered access to JKIA’s facilities in which it conducted site visits as part of its due diligence, documents tabled before Parliament’s Public Investments Committee (PIC) have shown.

Mr Mikosz, in a confidential memo written on October 3, 2018 to KAA managing director Johnny Andersen, requested data and information two days ahead of submitting the Privately Initiated Investment Proposal (PIIP) to KAA on October 5.

“Please let me emphasise that access to the respective JKIA resources by conducting site visits as well as access to key resources such as KAA’s management and IT systems might be also critical for the efficient and successful execution of the transaction,” Mr Mikosz wrote in a letter received by KAA on October 4.

PIC last week directed a suspension of the proposed merger, pending conclusion of its ongoing investigations into the proposed deal, which Mr Andersen said KAA did not initiate.

The MPs froze the proposed merger on grounds that it would render the profitable aviation regulator, KAA, bankrupt.

The parliamentary committee directed the Auditor-General to undertake a forensic audit on the transaction.

The merger of the two entities is intended to hand the cash-strapped KQ a financial lifeline, but KAA board minutes exposed fears that the plan could end up bankrupting the regulator.

Mr Andersen tabled the document which shows that the KQ boss requested the critical data from KAA in two batches.

“Therefore, I would like to kindly request KAA to provide data and information as outlined in appendices to this letter.

“Due to the transaction’s urgency and utmost importance, we have divided requested documents into two groups,” Mr Mikosz wrote.