fastjet has made “steady progress” in implementing stabilisation efforts, according to an update from the carrier.
Ahead of its annual general meeting, the low-cost African airline said a re-fleeting process, relocation of its headquarters from London to Johannesburg and a right-sizing of its operations in Zimbabwe and Tanzania had all played a role in stabilising operations.
These steps are having the desired effect and accordingly fastjet aims to achieve a cash flow break-even position for the final quarter of 2017, explained a statement.
The company also announced that it has entered into an agreement with easyGroup Holdings to acquire all intellectual property rights associated with the fastjet brand for a total consideration of $2.5 million, to be satisfied in cash.
The move will result in savings to the company over the next five years.
Stelios Haji-Ioannou, who established the fastjet brand in 2012 and founded easyJet in 1995, stated: “fastjet is a great brand in all its African markets, making it a highly valuable asset for the company.
“I have accepted the view of the current board that the company should own its own brand rather than licence it from me.
“I feel we have agreed a fair price for its transfer - $2.5m – which is less than what the company would have had to pay over the next five years.
“I still hold shares worth about £1.3m in the company and as such I will be a supportive shareholder, hoping to realise significant upside potential as fastjet grows and prospers.”
The company, aiming to leverage its relationship with Solenta Aviation Holdings, a strategic investor who acquired a shareholding in fastjet in January 2017 and who has an operational footprint in a number of African countries, is in the process of evaluating expansion options to further geographies and looks forward to making further announcements in due course.
Nico Bezuidenhout, chief executive, fastjet, appointed in the latter part of 2016, stated: “Brand development is an integral part of building a successful consumer facing business and represents a substantial investment for any airline – it logically follows that your brand, an asset to be leveraged for the benefit of shareholders, should be under your full control and ownership.
“We are happy to have reached agreement with Stelios and appreciate the ongoing confidence he has expressed in the fastjet business and leadership team.”