Restructuring of Fly 540 Angola and Ghana

 

fastjet, Africa’s low cost airline, today confirms that as previously announced, two of its loss-making Fly540 businesses are being restructured with the objective of increasing shareholder value. The Fly540 businesses operate on a traditional airline model and not the fastjet low cost model.

 

After a detailed evaluation of the potential of Fly540 in both Ghana and Angola, fastjet has concluded that, although these countries present very significant long-term opportunities for the fastjet low cost model, in the short term fastjet intends to fully focus on the considerable potential of opportunities in East and Southern Africa. 

 

As a key part of the restructuring, two group-owned ATR aircraft previously operating in Ghana and Angola have been taken out of service and are currently in the process of being sold.  While a leased aircraft continues to operate in Ghana, the Angolan operation has been temporarily suspended, pending the return to service of two leased aircraft on completion of required maintenance.  Further details on the restructuring of both 540 operations will be announced in due course.

 

Fastjet interim chairman and CEO, Ed Winter, said: “Management has been carefully considering how best to restructure the Fly540 business which we inherited and this is a highly significant and very positive development in that process.

 

“We are currently focused on expanding the low cost fastjet network in East and Southern Africa by establishing bases in Zambia, Kenya and South Africa and these plans are progressing well.  However, our overall vision is to create a pan-African low-cost network and, as such, launching the low cost fastjet model in both Angola and Ghana remains firmly part of the Company’s long-term plans.”

Kenya's Fly-SAX Seeks Tanzania Flights

 

The battle over Africa's skies ramped up a notch Tuesday as Kenyan low-cost carrier Fly-SAX said it was awaiting regulatory approval to launch a new airline based in Tanzania, a move that would put the airline head-to-head with fastjet PLC. Closely held Fly-SAX expects its SAX-Tanzania to make its maiden flight in the second half of the year with a fleet of small planes seating 12 to 80 passengers and serving some of the more remote parts of the country, according to a person familiar with the company's plans. In time, Fly-SAX hopes to get government approval for SAX-Tanzania to fly internationally from Tanzania, in a bid to attract a bigger and more lucrative market, this person said.

 

"We are launching a new airline to meet the ever-increasing demand for low-cost, efficient and safe air travel within Tanzania from the country's own citizens as well as international tourists," said Don Smith, chief executive of Fly-SAX and Fly 540 Kenya, in a news release prepared for distribution Wednesday. Fly-SAX has appointed Brown Francis as general manager of SAX-Tanzania. Mr. Francis joins from fastjet, where he was director for industry affairs for Tanzania. U.K.-based rival fastjet operates nationally and internationally from Tanzania, where it has effectively become the national flag carrier and has the right to fly to South Africa and Zambia.

 

The opportunity in Africa for airlines in general, and in particular for a budget carrier, is enormous because of the robust growth of regional economies and the continued development of internationally trading industries. These drivers have already triggered a significant rise in air travel. According to the latest data from trade body International Air Transport Association, air traffic measured by revenue passenger kilometers grew 5.1% from January to November 2013, compared with the same period in 2012. In Tanzania alone, capacity per week has grown to 54,000 available seats per kilometer from just 37,000 five years ago, according to aviation-consulting firm Innovata.

 

Source: wsj

The first 787-8 for Kenya Airways in their full livery arriving at Everett

Source: airliners.net

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Kenya Airways in talks to acquire bigger stake in Precision Air

 

 

Precision Air (PW, Dar-es-Salaam) is in talks with 41.23% shareholder, Kenya Airways (KQ, Nairobi Jomo Kenyatta), in a bid to raise USD30million in capital needed to keep the struggling Tanzanian airline afloat. According to The East African, the ongoing talks could see Kenya Airways boosting its stake in Precision Air after similar discussions with the Tanzanian government collapsed. “KQ was waiting for the government’s decision. When the government gave us its final decision on the matter, KQ came up with the idea to increase its stake, over which we are still in discussion. Our aim is it get between $20 million and $30 million through equity,” said Precision's chairman, Michael Shirima.

 

Faced with rising uncertainty about its future, caused largely by a failed 2012 IPO and an overambitious expansion plan, Precision Air has been forced to make drastic cuts to its fleet and route network in recent months as it struggles to stay afloat. Increased competition from Fastjet (FN, Dar-es-Salaam) on domestic routes has also compounded its woes.

 

Source: ch-aviation