Budget airline Fastjet to launch in Africa with EasyJet founder’s support

Source: Bloomberg
Author: David Risser

Lonrho Plc rose for the first time in 11 days after saying the industrial group completed the separate listing of its airline division, to be developed into a discount carrier for Africa called Fastjet.

EasyJet Plc founder Stelios Haji-Ioannou is a shareholder in the enlarged Rubicon Diversified Investments Plc, while Lonrho received shares valued at $85.7 million and holds 73.7 percent of the holding company, Lonrho said today in a statement, confirming details announced June 13.

Lonrho will be “a more passive shareholder” in the airline in order to focus on its agriculture, oil and gas support services, infrastructure and agri-logistics businesses, it said today. “This establishes a solid platform for the future development of the airline into a low-cost carrier for Africa.”

Lonrho advanced as much as 11 percent to 7.5 pence and was up 7.7 percent at 10:39 a.m., for the second-biggest gain on the FTSE All-Share Index. The shares had fallen 10 days in a row, the longest losing streak since at least 1998.

Stelios, who goes by his first name, is assembling a “specialist aviation team” for Fastjet, which will be led by Ed Winter, a former chief operating officer of EasyJet, Lonrho reiterated today.

Fastjet will employ operating licenses held by Lonrho’s Fly540 unit to establish flights in Ghana, Kenya, Tanzania and Angola using a fleet of Airbus SAS A319 airliners or Embraer E-190 regional jets, Winter said in an interview last month.

Fly540’s 10 turboprop aircraft are too small to form the basis of a discount carrier, and talks with leasing companies on establishing a fleet of Airbus or Embraer jets are at an advanced stage, Winter said at the time.

Rubicon Diversified was unchanged at 3.13 pence on London’s AIM market.

—Editors: Thomas Mulier, David Risser. To contact the reporter on this story: David Risser in London at drisser@bloomberg.net. To contact the editor responsible for this story: Marc Gilbert at mgilbert17@bloomberg.net