Fastjet re-enters local market in new joint venture

Money Markets

Fastjet has already applied to the Kenya Civil Aviation Authority (KCAA) for a licence. PHOTO | FILE 

By JOHN GACHIRI

In Summary

• Fastjet said its re-entry will entail a joint venture with a local investor where it will have a minority stake.
• The budget airline has submitted an application to KCAA for licensing and the authority is expected to give a decision next month.

Fastjet has made a comeback into the Kenyan market two months after it exited through selling its stake in Fly540.

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The budget airline said its re-entry will entail a joint venture with a local investor where it will have a minority stake.

“To comply with local airline ownership rules in Kenya, 51 per cent of the equity of Fastjet Kenya is owned by a Kenyan national. The balance of 49 per cent is ultimately held by Fastjet Plc,” said the budget airline.

The identity of the local investor was not disclosed.

The airline said it has already applied to the Kenya Civil Aviation Authority (KCAA) for a licence.

“We have submitted a comprehensive application to the authorities who have confirmed that Fastjet Kenya has entered the approval process.

“We look forward to bringing the Fastjet operation to Kenya, offering our market stimulating fares, our excellence on time performance and friendly service,” said Fastjet chief executive Ed Winter.

The low-cost airline said KCAA is expected to review its application and make a decision by the end of September.

ALSO READ: Fastjet plots Kenya entry after Fly540 venture exit

The licence application requires the airline to file details on its operation, network and commercial strategy.

Mr Winter said Fastjet will also use its Kenyan base to expand to other markets in the region.

“We are excited at the prospect of extending the footprint of the Fastjet operation through greater penetration of the African market with a Kenyan-based airline.

“This is in addition to the application for Fastjet Tanzania to operate services into Kenya from Tanzania. The process for designation of Fastjet Tanzania is ongoing,” said Mr Winter.

Low-cost airlines have been expanding locally to cater for the growing demand from business travellers and domestic tourists.

National flag carrier Kenya Airways launched its low-cost JamboJet arm in February while SouthEast Airlines begun operating last week.