25 Jun 2014 07:00
fastjet Plc
("fastjet" or the "Company")
25 June 2014
Disposal of Fly 540 Kenya
fastjet Plc, Africa's low-cost airline, is pleased to announce it has signed an agreement to dispose of its holding in Fly 540 Kenya, the loss-making investment it inherited as part of the acquisition from Lonrho Aviation, to Don Smith, a director of Fly 540 Kenya. The agreement wholly removes Fly 540 Kenya from the fastjet group.
All legal and financial ties between the two companies have been dissolved and each group has indemnified one another against any and all liabilities relating to the segregation of the businesses.
Ed Winter, Interim Chairman and Chief Executive of fastjet, said: "Following a period of complex negotiations, we are delighted to have achieved a successful outcome for all parties. After a thorough and lengthy evaluation of Fly 540 Kenya, we concluded that converting the business into the fastjet low-cost model would not be economically viable.
"Disposing of our investment in Fly 540 Kenya allows us to pursue our priority objective of creating fastjet Kenya as a new entity which will operate to the same low-cost model, international standards of safety, reliability and punctuality as fastjet Tanzania and utilise the same commercial strategy and distribution platforms. Further information on the Company's plans to launch fastjet Kenya will be announced in due course."
Fly 540 Kenya is treated as an investment in the fastjet Group accounts as fastjet does not have financial control over it and has not included its losses in the Group consolidated accounts. Most of the investment has already been written down and the remaining US$10m will be written down in the full year 2013 accounts. The disposal, which is for a nominal sum, is a related party transaction under the AIM Rules as it is a disposal to a director of Fly 540 Kenya. The directors of fastjet consider having consulted with WH Ireland, that the terms are fair and reasonable insofar as its shareholders are concerned.
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Angharad Couch
Eleni Menikou
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Cian Mac Eochaidh
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W.H. Ireland Ltd. Tel: +44 (0) 20 7220 1666
James Joyce
Nick Field
NOTES TO EDITORS
About fastjet plc
fastjet Plc is the holding company of the low-cost airline fastjet which commenced flight operations in Tanzania in November 2012. The airline operates a fleet of distinctively branded Airbus A319s and since its launch has grown to encompass the key domestic routes within Tanzania and a rapidly increasing number of international destinations. By adhering to international standards of safety, quality, security and reliability, fastjet has brought a new flying experience to the African market at unprecedented low prices.
fastjet is implementing the low-cost carrier model across Africa and its long-term strategy is to become the continent's first low-cost, pan-African airline. fastjet Plc is also the holding company of airline Fly540, which operates in Kenya, Ghana and Angola.
By offering one way fares from as low as $20, fastjet has stimulated a new customer base; the results of a customer survey showed that 38% of fastjet passengers had never flown before. This democratisation of air travel is expected to gather momentum across the final continent to experience the low-cost airline revolution.
fastjet is committed to communicating effectively with its existing and potential customers and has, to date, won a number of marketing awards. With over 140,000 social media followers, it occupies a unique position in African aviation.
fastjet Plc is quoted on the London Stock Exchange's AIM market.
For more information see www.fastjet.com