How Adani Group’s airport deal will be a loss for Kenyans
The proposal to redevelop Jomo Kenyatta International Airport seeks to facilitate a tax holiday for the Indian conglomerate and increase costs.
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The proposal submitted early this year by Indian conglomerate Adani Group to Kenya Airports Authority to develop and renovate parts of Jomo Kenyatta International Airport has recently been made public.
To facilitate informed public engagement with the proposal, as a project finance student, I thought it would be useful to provide an expert view on its key technical aspects.
Adani exploits a provision in Kenya’s Public Private Partnerships Act of 2021 that allows private companies to initiate project proposals and channel them to the government for consideration.
Briefly, Adani seeks to run Jomo Kenyatta International Airport via a 30-year build, operate and transfer arrangement. Under this arrangement, ownership of the airport remains with Kenya Airports Authority, known as the deal sponsor. The airport business is handled by Adani’s subsidiary, Airports Infrastructure Plc, called the special purpose vehicle.
Airports Infrastructure Plc, which was registered in Nairobi on August 31, 2024, is fully owned by the United Arab Emirates incorporated Global Airports Operator LLC.
Global Airports Operator is a subsidiary of Adani Airports Holdings Limited of India, which in turn is fully owned by Adani Group.
The proposal omits information on Adani Airports Holdings Limited’s extent of ownership of Global Airports Operator. This leaves room for speculation about Global Airports Operator’s beneficial owners.
The proposal shows that the project requires a cash outlay of $2.05 billion...
