Last week, Fastjet said its chairman, David Lenigas, and chief executive Ed Winter would travel to SA this week to negotiate with "local authorities" and 1time's provisional liquidator with the aim of buying the bankrupt airline and relaunching it. The company said it had found "a solution to secure acceptable partnership arrangements which ensure that any change of control of 1time would comply with current South African laws on foreign ownership".
Fastjet has spent the past two months cooling its heels; waiting for a response from Transport Minister Ben Martins regarding a licence. Under South African law there is a 25% limit on foreign ownership of a domestic carrier; any exemptions to this provision must be sanctioned by the transport minister.
"Fastjet is hopeful that a deal will be finalised soon and feels confident that an acceptable solution can now be put to the liquidator so a meeting of creditors might be called," it said.
1Time's ferocious losses bankrupt the popular carrier a year ago and it was helped in no small measure by record fuel prices and a fuel-guzzling fleet. Months of negotiations with creditors - collectively owed about R500m - finally failed in December, forcing 1time to abandon operations just weeks before the holiday season.
Fastjet, which has low-cost carrier operations in Kenya, Ghana, Tanzania and Angola and wants to establish a pan-African business, had hoped to re-launch 1time's services in time to still cash-in on the end-of-year holiday travel. For more than a month, 1time liquidator Aviwe Ndyamara has been saying that a response from the transport minister was expected "soon".
Skywise is being championed by a group of entrepreneurs that first founded 1time nine years ago. Skywise aims to take 6% of the 14m passenger seats in its first year of operations, financial director Glenn Orsmond said last week.
Skywise and Fastjet agree that with the removal of 1time's 2m seats, domestic air fares have spiked, creating opportunities for new carriers to enter the market to service demand for low-cost travel.
"Air fares in SA appear to have skyrocketed since 1time ceased flying at the end of last year, and many planes are operating at full capacity on the key Cape Town and Durban routes," Lenigas said. Last week, Fastjet said it had secured access to £15m in funding to pursue its plans to expand its operations in Africa.
Source: Business Day via I-Net Bridge
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