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{
    "id": 678378,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/678378/?format=api",
    "text_counter": 190,
    "type": "other",
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    "content": "in the news on the national media. All the above actions will reduce monthly costs by US$8 million. (3) In order to increase revenue, raise working capital and cut down on costs, the company has:- (a) sold land to the Kenya Medical Supplies Authority (KEMSA); the key tenant to raise US$20 million, which is in the final stages of approval; (b) made changes in commercial operations, including people and prizing restructure; (c) restructured short-term debt to give room for recovery; (d) sold the London slot to raise US$50 million cash and the release of 787 series. (4) The company has a plan to undertake a staff downsizing as part of the turnaround strategy, which we are aware that Phase 1 has already been done and completed. (5) On the implementation process the Government, which is the major shareholder, is reviewing the financial position of the company in order to support the turnaround plan. Further, an ad hoc Committee of the Cabinet has met representatives of the Royal Dutch Airlines (KLM), with a view to establishing their role in the turnaround strategy and whether KLM can raise short-term finances. The discussion also revolved around the need to examine the master co-operation agreement, commercial partnership between KLM and KQ. The Government will, through the board, review the joint venture with KLM, especially on the provision of the code sharing, revenue management and sales tracking to ensure equity in revenue sharing. (6) The recommendation of arbitration alternatives continue to be applied as part of dispute resolution and continuous engagement with unions. No new outsourcing contracts have been entered into in the period so far. Mr. Deputy Speaker, Sir, if you allow me, I will go through the suggested way forward that arose from the meeting that was conducted between the KLM and KQ. (1) Mitigating the challenges of KQ be approached as follows:- (a) examining the master corporation agreement between KLM and KQ; (b) registering and acknowledging the commitment of the Government of Kenya to sustain the operations of KQ as a major shareholder; and, (c) commitment by both parties (KLM and KQ) to review and update the agreement referred to in part (a). (2) As part of protecting the interests of the airline and its shareholders, all legal avenues have been explored. (3) A formal record of the discussion and resolution between the Government of Kenya and KLM, as shareholders of KQ, be kept for future reference. (4) The KQ board and management have briefed the Committee severally on the financial restructuring plan, which has now been endorsed for execution. (5) The Government of Kenya and KLM as major shareholders reaffirm their support to the operational and financial turnaround plan. The Government has, in addition, borrowed on behalf of KQ from Afriexim to the tune of US$ 200 million to enable the airline access funds for its short-term obligations and operational needs. The electronic version of the Senate Hansard Report is for information purposes only. A certified version of this Report can be obtained from the Hansard Editor, Senate"
}