In a hurry? Here’s a quick summary…
- Adani Airport Holdings paid a $50,000 review fee and submitted documents to propose a $1.85 billion upgrade of Nairobi’s Jomo Kenyatta International Airport (JKIA).
- The proposal is under review, but a court has halted further actions after a legal challenge from Kenyan organizations.
Adani Airport Holdings Limited has confirmed paying a $50,000 (Ksh.6.47 million) review fee to the Kenyan government for its $1.85 billion (Ksh.242 billion) proposal to take over and upgrade Jomo Kenyatta International Airport (JKIA) in Nairobi.
In newly revealed court documents, the Indian infrastructure giant, part of the Adani Group, stated that the fee was paid to the Public Private Partnerships Facilitation Fund alongside the submission of documents required for its privately initiated proposal (PIP) to the Kenyan government.
The company, through its lawyers, explained that it complied with legal requirements by submitting the PIP and paying the review fee.
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It also provided pre-approval documents, including corporate, tax compliance, and financial details to assist the Public Private Partnership (PPP) Directorate and the Kenya Airports Authority (KAA) in their due diligence process.
Adani made these submissions in response to a case filed by the Kenya Human Rights Commission (KHRC) and the Law Society of Kenya (LSK), which challenges the deal.
According to Adani, the KAA acknowledged receipt of the proposal on March 18 and cleared it to move to the feasibility study phase.
The company has since submitted a feasibility study report detailing the project’s environmental and social impact, financial plan, and how it will benefit the Kenyan public.
The report also includes an operating plan for the project, which Adani claims aligns with Kenya’s infrastructure priorities and addresses recurring issues at JKIA.
In its court response, Adani clarified that the project remains in the review and due diligence stage, countering claims from KHRC and LSK that JKIA has already been leased for 30 years.
The two organizations argue that the airport’s leasing to a foreign company lacked adequate consultation and transparency.
The Public Private Partnerships Act stipulates that privately initiated proposals must meet several conditions, including alignment with national infrastructure goals, delivering value for money, and being supported by sufficient documentation.
Proponents must also pay a non-refundable review fee of $50,000 or 0.5% of the project cost, whichever is lower.
However, the payment of the fee does not create any obligation for the contracting authority or the PPP Directorate.
Adani’s proposal was submitted on March 1, 2024, after the company learned about JKIA’s deteriorating condition through Kenyan media.
Former Transport Cabinet Secretary Kipchumba Murkomen had hinted at plans to upgrade the airport last year, although he did not provide specific financial details.
KAA’s acting CEO Henry Ogoye has acknowledged the significant capital required for the project, which the government cannot afford due to fiscal constraints.
A court ruling on September 9 temporarily halted any further action on the proposed lease of JKIA until the case is resolved. The next hearing is scheduled for October 8.