Zimbabwe: Fastjet Yet to Close Restructuring Deal

28 January 2020

Fastjet Plc said yesterday it is still to finalise its due diligence on fastjet Zimbabwe and securing the required regulatory approvals for its disposal.

In November 2019, fastjet said it was looking to offload the Zimbabwe unit to a consortium led by its major shareholder, Solenta Aviation, for US$8 million, a deal which could help the South African low-cost carrier stay alive until 2021.

If the restructuring plans do not pan out by end of February, the Africa-focused company may not be able to continue trading as a going concern, fastjet said then.

Yesterday, the company warned again that it would not be able to continue as a going concern if it could not carry out its restructuring proposal by the end of March due to a shortage of funds.

The company is struggling to get funding for restructuring its business as talks with an investor consortium led by its biggest shareholder Solenta Aviation to sell its Zimbabwean operations are yet to be finalised.

Meanwhile, fastjet projects that it will have sufficient resources to meet its operational needs until the end of March, with cash reserves of only $3 million as at January 23, 2019.

fastjet, which has operations in Zimbabwe and South Africa said it was trading in line with management's expectations through the year-end including the peak holiday season, with revenue expected to be $42 million.

Loss after tax for the year ended December 31, 2019, was expected to shrink to between $7 and $8 million from a loss of $65 million a year earlier.

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