No deal yet, critical talks underway for Sh1.1tn Adani deal, CS Chirchir says » Capital News
Nairobi, Kenya, Sep 13 – Negotiations for the Sh 1.1 trillion takeover of Jomo Kenyatta International Airport (JKIA) by Adani Limited, an Indian firm, have reached a critical stage with the outcome expected to have far-reaching implications in airport management.
Documents presented before the Senate Roads, Housing, and Transportation Committee revealed that the government has initiated a due diligence process to evaluate the technical and financial capacity of Adani Limited, following a Privately Initiated Proposal (PIP).
Transport and Roads Cabinet Secretary Davis Chirchir refuted claims that a final concession agreement had been reached, clarifying that only a “Head of Terms” agreement—summarizing key negotiation points—has been agreed upon.
The Cabinet Secretary emphasized that the agreement is neither signed nor legally binding as it stands.
“We have not reached the contracting stage of this transaction. The Head of Terms agreement merely outlines the key points of negotiation and is pending stakeholder engagement and due diligence, which will inform the drafting of the concession agreement,” Chirchir told the senators.
Members of Parliament raised concerns over the ongoing negotiations, with some accusing influential government leaders of favoring Adani in securing a 30-year lease for the airport.
Narok Senator Ledama Ole Kina questioned why the government had entered into talks with Adani Limited, given allegations of corrupt practices involving the firm in other countries.
“There are indications that Adani has been involved in questionable activities elsewhere. If you search online, you’ll see it’s a multinational corporation with a tainted reputation,” Senator Ole Kina remarked, in reference to reports of a delegation sent to India to assess Adani’s financial and technical capacity.
Chirchir explained that the government is unable to borrow due to the current fiscal deficit but highlighted the pressing need to upgrade JKIA. He pointed to Adani’s experience in running major airports as a reason for their consideration.
“Why Adani? They operate one of the world’s largest airports in Mumbai, which handles 60 million passengers annually. It is considered among the most efficient airports globally. Of course, we will thoroughly assess both the positives and negatives in our due diligence process,” he said.
Senators also expressed concern over the content of Adani’s proposal, which appeared to include insider information on JKIA’s challenges, raising suspicions about the transparency of the process.
“The information submitted by Adani is troubling—it includes satellite images and detailed analysis of our airport. If this isn’t an insider deal, how else would Adani have acquired such information?” Senator Ole Kina questioned.
In response, Chirchir admitted that certain details about JKIA’s issues were shared with Adani as part of efforts to attract investment.
“We provide information to potential investors to generate interest. It’s essential to give accurate details,” Chirchir noted.
Chirchir further denied claims that the “Head of Terms” was drafted solely by Adani Limited, clarifying that ALG, a Spanish firm, and Ashitiva Advocates, a Kenyan law firm, were involved in the drafting process.
“The Head of Terms was not prepared by Adani Limited alone. ALG, a well-regarded Spanish firm with expertise in airport management, played a key role. The document was thoroughly negotiated,” he said.
Adani submitted a privately initiated proposal (PIP) to the Kenya Airports Authority (KAA) in March this year to operate JKIA under a 30-year concession.
The Indian firm financial proposal shows that Sh 230 Billion will be spent on the development of a new terminal building, associated apron and taxiway system and two rapid exit taxiways.
The Indian company is proposing a city-side development consisting of hospitality, business centres and other amenities accessible to travellers and city residents.
Last week,Adani Enterprises has set up a Kenyan subsidiary as it steps up its push to take over the running of Jomo Kenyatta International Airport, amid continued opposition among transport workers to the takeover by the Indian conglomerate.
The flagship company of Gautam Adani’s sprawling corporate giant incorporated “Airports Infrastructure PLC (AIP)” in Kenya on August 30, according to a filing with the National Stock Exchange of India in Mumbai.
About The Author
