Kenya’s national carrier Kenya Airways (KQ) had dismissed allegations by Deputy President Rigathi Gachagua that it was under State Capture.

KQ’s chairperson Michael Joseph in a statement refuted the claims and said all KQ contracts are exclusively commercial business dispositions aimed at benefiting KQ.

He was responding to allegations Gachagua made during an interview with a local TV station insinuating State capture was the reason KQ was making losses.

“We have had discussions with Kenya Airways and they have the highest fares on the continent and their planes are always full but they make losses. We are trying to deal with that State capture so that we can bring down the cost of the operations of the airline so that they can make profits,” Gachagua stated.

Joseph disclosed Kenya Airways entered lease agreements with distinguished international companies which manage many aircraft leased to international airlines throughout the world.

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He also outlined the number of KQ-operated aircraft under two different models for long-term leases or operating leases.

According to Joseph, the long-term leases come with an option to purchase the aircraft at the end of the lease while in the operating leases, the lessor and the lessee in agreement plan for a prescribed period in exchange for regular payment.

KQ chairperson also dispelled claims the company is overpaying fees for services offered to the national carrier.

He said the costs lie well within the prevailing market rates at the time of negotiating the transactions.

Joseph also disclosed there are discussions between KQ and the lessors to reduce the general cost of aircraft lease rentals.

He also said that Kenya Airways is a publicly listed company with the Kenyan Government which owns a 48.9 per cent stake in the carrier as the majority shareholder.

Banks which are KQ lenders with debts converted into shares in 2017 follow the Kenyan Government at 31.8 per cent and Dutch carrier KLM follows with 7.8 per cent.

Minority shareholders hold a 2.8 per cent stake while KQ employees have 2.4 per cent ownership.