12 Star H Monday, 7 April 2008 Up to date, accurate business information STAR BIZ NEWS YOU CAN USE, EVERY DAY. Can YOU outsmart the expert? Airline rivals kq ALY KHAN’S STAR on route By Peter Kiragu PORTFOLIO THREE months after launching Nairobi - Entebbe operations, Air says do some maths before it has surpassed its projections by more than 15 per cent, a taking that ipo loan fact that should worry national carrier (KQ), which has dominated the route Every where I turn the The Numbers for the last eight years. banks are falling over The Bank lends you Already the airline that now themselves to lend money Sh100, 000. You will pay boasts of the tag “Uganda for Safaricom shares. a commitment fee of at national carrier” is making This is in the whole least 1 per cent. That is a threatening inroads into the commendable and cost of Sh1, 000. route and now controls a 35 per cent market share and all philosophically, I far prefer Let’s say for argument’s indications are that this could seeing people borrowing sake that you end making reach 50 per cent before the for investment rather use of their money for 90 end of the year. So far, the than consumption (and days (refunds can be slow) airline says it has carried over herein lies the key, you and they are charging 21,000 passengers. Other get an outsize return for you 16 per cent. That is small airlines such as Fly540 the consumption you another Sh4, 000. So your have also cast their nets in the deny yourself now). A total cost for the loan is lucrative route. year and a half ago when I Sh5, 000 plus you have to Air Uganda adds that it now interviewed Dr. Mwangi of repay Sh100, 000. controls over 70 per cent of the Entebbe – route and Equity Bank, I asked him The two key variables 44 per cent in the Entebbe – NEW KID: Air Uganda chief executive officer Peter de Waal at a press conference in Nairobi. what was the competition. are therefore, the , both of which He said; “The Mattress.” amount of shares you were initially tightly held by rather but by offering high other serious airline flying into plan was to face off KQ on the We have moved on some receive (the issue will be KQ. Where this leaves KQ re- quality services. However, a Entebbe placed KQ at a posi- route, Waal said: “That is not from there, now we are oversubscribed) and the mains to be seen but the chief trip with the airline last week tion where it could take undue our plan, indeed other airlines mobilising our idle and price that you can sell the executive, Titus Naikuni, may revealed no special service that advantage to manipulate fares that have tried to beat KQ end- risk capital for the IPO shares at. Let’s assume surely be having some sleep- other airlines do not offer. The at whim. KQ has also been ed up crippled. Our objective is and after the successful you receive 25 per cent of less nights. But the success of airline has also not made inter- accused of being insensitive to be the best airline in 2009.” listing of Safaricom, many the shares you apply for. the youngish Air Uganda will line agreements, something to passengers on that route He was speaking to journalists folk will find an appetite That is 5,000 shares. Now, depend on whether the air- that restricts it from carrying by maintaining uncomfort- at the airline’s headquarters in line, which operates only two connecting passengers. able departure times while of- . for entrepreneurship. let’s assume that the price aircrafts, will be savvy enough Nevertheless, the airline has fering services that Buhendye Uganda has been haunted We might just unleash reaches Sh9. to convince potential clients to a bargaining ground especially described as “substandard”. It by a ghost of collapsing air- 2,000,000 new You sell your 5000 switch their loyalty from KQ, on the Entebbe – Nairobi route has also been accused of over- lines and it remains to be seen entrepreneurs. This for shares at a price of Sh9. the airline they have known where KQ has been accused of booking. whether the same fate will be- me is going to change the You now receive Sh45, since collapse of Uganda na- treating Ugandans like “sec- Air Uganda chief execu- fall Air Uganda. Apart from national landscape and this 000 less commissions. tional carrier, , ond hand travellers” according tive Waal is however cautious Uganda Airlines, operators sense of empowerment The result is cost Sh105, in 2001. to the business editor of the on some of these accusations such as Africa One and Alli- and enfranchisement will 000, refund of Sh75, 000, For instance, Air Uganda Ugandan Red Pepper newspa- against KQ and knows too well ance Air have all collapsed. be remarkable to behold net Sh30, 000 balance. chief executive Peter de Waal per, Silas Buhendye. that to beat the dominance of East African Airlines has not and something our political Sell your shares for says the airline was not com- He said the absence of a one of Africa’s best airlines is been spared either nor has been peting by offering lower prices Uganda national carrier or an- not an easy task. Asked if the Victoria International Airlines. class would be wise to pay Sh43, 000 net, you receive notice to. Sh13, 000. Now, many folk will go The number of shares to the bank and take a allocated and the forward loan to buy shares but price are the key. NGO delivers reprieve for small businesses it is important that you Aly-Khan Satchu understand the maths and www.rich.co.ke is the By Lola Okulo employed by MSEs and even urgent help. It is estimated that the poverty line. She said: “We the dynamics of what you author of Anyone Can Be the big businesses depend on the MSE sector accounts for hope that this project will in are doing and what will Rich, available in local The economy cannot recover the small businesses. So until about 20 per cent of Kenya’s the long term rid the country make or break the trade. bookshops until small businesses recover the MSEs recover from the GDP. Kapila noted that there of poverty”.She added that from the post-election dam- post-election damage, the was urgent need to not only these businesses employed age, a local non governmental economy cannot recover,” help the businesses recover a large number of people as organisation has said. explained Kapila. but to also help them sustain they accounted for 96 per cent Speaking during the launch KGT has formulated a themselves so as to reduce the of all the businesses in the t SAFARICOM IPO: Dates of a trade initiative aimed at five-year programme in aid of number of people living below country. helping the medium and small- recovery in which it plans to sized enterprises recover from bring on board various donors Domestic Pool Opens 28 March, 2008 losses, the vice chairperson of to provide funding that will be International Pool Opens 9 April, 2008 Kenya Gatsby Trust Sunita Ka- given to the MSEs in form of Offer Closes 23 April, 2008 pila said that the MSEs make soft loans. Announcement of Allocation Results 30 May, 2008 up 96 per cent of all businesses Already the trust has the in the country adding that un- backing of the United Nations DVP Settlement Date 2 June, 2008 til they are back on track, the Development Programme and CDS Accounts Commence Allotments and Elec- economy would not grow. few other stakeholders who tronic Credit 4 June, 2008 The initiative dubbed Heal- have pledged to fund the ing Kenya Through Trade will initiative. The initiative has Share Certificates, Electronic Refunds and Refund help traders of medium and identified Kisumu, Eldoret, Cheques dispatched (if applicable) 9 June, 2008 small ventures crippled by the Nakuru, Naivasha and NSE Trading of Safaricom Shares Commences 9 post election crisis get back to Nairobi traders, particularly June, 2008 business. “75 per cent of the those in the informal settle- population in this country is ment, as the ones in need of CHOCKED: Small businesses suffered hugely in post poll violence