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.
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