Kenya Airways has selected Cairo-based Africa Export-Import Bank (Afreximbank) to organise financing for its purchase of 20 new aircraft.
The credit facility will be used for the purchase of 10 Embraer-190 jets, nine Boeing 787-800 Dreamliners and one Boeing 777-300ER aircraft.
According to the airline, the financing package consists of a pre-delivery payments (PDP) facility and an aircraft delivery finance facility to fund the delivery of the ordered aircraft.
The Kenyan national carrier recently raised KES14.5bn ($173m) in a rights issue, which will be used for financing pre-delivery payments for the nine Dreamliners, the first of which is expected to be delivered in first quarter of 2014.
The airline's plan to spend $3.6bn over the next five years and a ten year growth plan is expected to increase its fleet size from 34 aircraft to 119 and destinations to 115 from 57 by 2021.
Kenya Airways Group managing director and CEO Titus Naikuni said that the company's ten-year strategy was robust and based on sound business projections.
"The new deliveries financed by Afrexim, will serve both capacity increase, as well as allow for replacement of aircrafts that are due for retirement," Naikuni said.
"The Dreamliners will replace the 767s, whilst the E190s will be used for capacity expansion on the Africa/regional routes"
The deliveries of E190s are scheduled during the third quarter of 2012, while the B777-300ERs are expected to begin during the fourth quarter of 2014.
Kenya Airways, which is 26.73% owned by AirFrance KLM, is planning to launch a low-cost subsidiary to manage regional flights
Image: The first of the nine Boeing 787-800 Dreamliners is expected to join the Kenya Airways fleet in 2014. Photo: courtesy of Boeing Image.