7 February 2013

Kenya: Fastjet Take Off Runs Into Headwinds

LOCAL carrier Fly540 has withdrawn licences it had granted to FastJet to operate regional flights under its brand citing various violations of the agreement by the latter.

In a statement sent by its London based PR consultany firm Luther Pendragon, Five Forty Aviation Ltd said the withdrawal of the licenses take effect immediately for Fastjet operations in Tanzania, Angola and Ghana where the budget airline had already started its operations.

"We had no choice but to take this action because the most worrying aspect of non-compliance with the licensing agreement is that we have no way of assuring that the planes are safe to fly. We have not received any safety reports for the past three months from FastJet's Africa Operations and we believe that one plane, which flew with defects from Tanzania and landed in Nairobi on 14 December, should not have flown," said FLY540 CEO Don Smith.

Fly540 has accused Fastjet of non payment of outstanding licence and other fees of US$6.9m(Sh603.8 million), US$0.5m(Sh43.8 million) and US$0.3m (Sh26.3 million) for Fly540 Tanzania, Fly540 Angola and Fly540 Ghana respectively. It also accuses Fastjet of not providing safety information by Fly540 for perusal and that it also failed to disclose its financial information for December 2012.

However FastJet has denied these allegations and said it will take action against Smith over this issue.

"Fastjet is committed to conducting its business in an open, transparent and entirely legal manner through the proper channels. The Company does not intend to continue rebutting false allegations through the press but will take legal action over any further such claims," commented Fastjet chairman David Lenigas.

Following the spat, Five Forty Aviation Ltd now wants Fly540 Angola and Fly540 Ghana to re-paint their aircrafts in a neutral colour as well as sales offices to disassociate the brand with Fastjet. It has asked Fastjet to return all materials containing the Fly540 logo and rename the companies.

Fastjet which recently announced that it had signed a memorandum of understanding with another Kenyan carrier Jetlink, said its launch in Kenya will not be hindered by the current problems adding that it has paid Smith and his partners over US$6m (Sh525 million) for their interest in Fly540 and associated brands.

Lenigas said: "We feel that Jetlink, which already has IOSA accreditation, is a far better Kenyan partner for fastjet given our standards of safety, security and reliability . Following an extensive review, we concluded that Jetlink would provide a better long term launch-pad for fastjet due to its superior infrastructure and accreditations to service and manage a fleet of modern large jet aircraft."

Jetlink MD Elly Aluvale said he did not wish to get involved in the disagreement but said his airline needs a strategic partner and is therefore keen on pursuing talks with Fastjet.

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