Does Chris Kirubi Have A Hand In KQ Shakeup?

Only a year after Chris Kirubi made a surprise move to buy 2.1 million shares in Kenya Airways (KQ), the airline company has made several changes, including a shakeup of its top management, begging the question of whether Kirubi could be having a hand in the changes.
 

Chairman and CEO exit
The wave of changes at Kenya Airways has seen the company’s chairman and CEO ousted in quick session. Dennis Awori last month resigned as Kenya Airways’ chairman amid surging staff and investor clamor for management change at the struggling company. Awori was replaced by a former Safaricom (SCOM) CEO Michael Joseph. 

Less than a month after Awori’s departure, Kenya Airways recently announced that its CEO Mbuvi Ngunze will leave the company early next year. Ngunze is leaving the airline despite earlier assurance by Joseph that the CEO would stay after Awori left.

Amid the changes at Kenya Airways, the focus is turning on billionaire investor Kirubi, with some wondering whether he is beginning to exhibit activist investor traits. Activist investors acquire large stakes in companies they target for reform and then push for radical leadership changes, including overhauling the board of directors and lobbying for a management team that agrees with their philosophies.

In late 2015 when other investors were selling Kenya Airways shares, Kirubi pumped Ks12 million in the stock to acquire 2.1 million shares. Kirubi said at that time that he wasn’t pursuing immediate returns with the investment in the ailing airline company. Instead, he said the investment was only a show of his support for the national carrier – the Pride of Africa. Kirubi even urged more Kenyans to buy Kenya Airways shares as part of their patriotic duty.
 

But what Kirubi didn’t tell you was that buying Kenya Airways shares in the open market doesn’t put money in the company’s bank account.
 

Waweru buys depressed KQ shares 

Besides Kirubi, Michael Waweru, a former boss of Kenya’s revenue agency, the Kenya Revenue Authority (KRA), is another prominent investor who has been accumulating Kenya Airways shares while the appear cheap. Waweru owns about 1.1 million shares in Kenya Airways as disclosed in regulatory filings earlier this year.

The Kenyan government also owns a large stake in Kenya Airways.