Sir Richard Branson Dissolves Kenya Business

Billionaire Richard Branson has dissolved his aviation business in Kenya, diminishing hopes of Virgin Atlantic making a return to Kenya after withdrawing flights last year.

Virgin Atlantic recalled its registration six years after it launched the Nairobi-London. Photo/FILE

Virgin Atlantic recalled its registration six years after it launched the Nairobi-London. Photo/FILE NATION MEDIA GROUP

Virgin Atlantic Airways Limited recalled its registration six years after it launched the Nairobi-London route, according to the Registrar of Companies.

The airline in May announced that its last flight on the route will be on September 24 and remained open to making a return should market conditions change.

Virgin Atlantic linked its withdrawal in Kenya to low passenger numbers, high fuel costs and increasing aviation taxes in Britain.

The dissolution of the Kenyan business signals that Virgin Atlantic is unlikely to make a return to the Nairobi routes in the short to midterm.

“Pursuant to Section 373 (1) of Companies Act, it is notified for general information that the under mentioned company is dissolved. F 32/2007 Virgin Atlantic Airways Limited,” said Colleta Maweu, the Registrar of Companies through the latest Kenya Gazette notice.

Despite withdrawing his airline from the Nairobi route, Sir Richard has continued to invest in the Kenyan market.

Last month, he hosted President Uhuru Kenyatta at his newest luxury hotel in the Maasai Mara dubbed Mahali Mzuri Safari Camp, whose rates start from $590 (Sh50,740) per person per night.

Virgin Atlantic had forecasted to break even on the London-Nairobi route in at least two to three years, but the airline found it hard to match capacity with passenger demand.

London is a seasonal route that caters mainly for leisure tourists and business travellers. Cargo is also a major revenue contributor.

The Eurozone crisis has seen the passenger volumes on the route drop in the past one year leading KQ to suspend daytime flights.

“Europe is still a major market in terms of volumes and believe it will turn around,” said Titus Naikuni in an investor briefing last week.

Capacity offered into Europe shrunk by five per cent owing the withdrawal of all daylight operations as part of turnaround efforts to trim unprofitable operations.”

Kenya Airways posted a profit of Sh384 million in the year to September compared to a loss of Sh4.78 billion in the same period last year.

– Business Daily