Major Fastjet shareholder calls for sacking of directors
What you need to know:
Billionaire entrepreneur Stelios Haji-Ioannou, who owns 12 per cent of the Africa-focused budget airline, wants its chief executive Ed Winter and director Krista Bates to resign from the company immediately.
According to him, Fastjet is making unrealistic revenue projections given that it only operates six aircraft.
With its hub in Dar es Salaam, the airline flies within Tanzania as well as Uganda, Kenya, Zambia, Zimbabwe, South Africa and Malawi.
A British entrepreneur who owns a stake in budget carrier Fastjet has called for the immediate dismissal of two of the firm’s directors over what he terms as extreme increase in operating costs, The Guardian has reported.
Stelios Haji-Ioannou, who owns 12 per cent of the Africa-focused budget airline, wants its chief executive Ed Winter and director Krista Bates to resign from the company immediately.
According to the UK-based publication, Mr Haji-Ioannou called a general meeting to rally for the dismissal of the duo, arguing that mismanagement would leave the company without cash “sometime in 2016.”
“The company has a ridiculously high cost base...Mr Winter has burnt some £80 million in the last three years,” said Mr Haji-Ioannou.
Mr Winter, who has been the CEO of Fastjet since 2012, mid last month announced that he would step down from his position once a new chief executive is appointed.
The London-listed firm announced that he would, upon his departure, continue in an advisory role for an agreed period of time.
However, the billionaire investor who helped set up the Tanzania-based budget airline is now flexing his influential muscle in a bid to secure Mr Winter’s immediate discharge.
According to him, Fastjet is making unrealistic revenue projections given that it only operates six aircraft.
“We believe the company will run out of cash sometime in 2016. We now have about six months left to steady this ship. Time is of the essence,” said Mr Haji-Ioannou.
The low-cost carrier last month launched daily flights from Dar es Salaam and Kilimanjaro to the Jomo Kenyatta International Airport (JKIA) at rates relatively cheaper than its competition.
A month after launch, the budget carrier cut its Dar flights to two a week due to low passenger numbers.
With its hub in Dar es Salaam, the airline flies within Tanzania as well as Uganda, Kenya, Zambia, Zimbabwe, South Africa and Malawi.
Fastjet last April raised Ksh7.5 billion to fund its penetration of the African market, money it intends to fund its expansion and entry into markets such as Rwanda, eastern DR Congo and South Sudan.
