A Fastjet plane. FILE PHOTO | NMG
Low-cost African airline Fastjet could effectively go bust on
Friday if further funds are not found from its shareholders and
investors.
The troubled airline set up by easyJet
founder Sir Stelios Haji-Ioannou, flies in several African countries
including South Africa, Tanzania and Zimbabwe but has been in financial
trouble for some time and withdrew its flights from Kenya in 2016.
It
lost an average of $50m a year up until 2016 and has yet to file its
2017 results, which have to be published by Friday for it to remain
listed on London’s AIM exchange
The company now says that if no new funds emerge, Fastjet may not be "able to continue trading as a going concern".
The result was that within hours of the announcement Fastjet
lost more than two-thirds off the value of its shares in a matter of
hours.
“Whilst initial discussions with certain
shareholders have been positive, discussions are ongoing and there can
be no guarantee of a successful outcome,” it warned on Wednesday.
The
airline started operating in 2012 with the backing of easyJet’s founder
but has “continued to consume cash”, and it now had just $3.3m in its
reserves.
Fastjet launched in Tanzania with an ambition
to become a pan-African low-cost carrier, but it has struggled
throughout with problems.
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