Fastjet risks having three of its aircrafts leased by its Tanzanian operation deregistered following unpaid leasing and maintenance bill of almost two million dollars.
Fastjet
Canadian based Avmax Aircraft Leasing has written to FastJet saying it was removing the registration of three planes leased by the Tanzanian operation flying under the Fly540.
The letter from Avmax Vice-President Don Parkin, headed “Notice of De-Registration,” notified “Fly540/Fastjet of its continuing default” under the lease terms.
“As such, the lessor has elected to deregister the aircraft from the Tanzanian Civil Aviation Registry.” The January letter said the deregistration will “be commenced immediately,” read part of the letter.
Mr Parkin’s letter followed a warning in November, last year, that Fly540/FastJet was in default and continuing “to refuse and neglect your financial obligations.”
Avmax claimed the airline had undertaken to pay 150,000 dollars per month for the rental and maintenance of the planes. The letter was sent to FastJet’s Chief Financial Officer Angus Saunders and Don Smith, the majority owner of Five Forty Aviation, which has a separate £4.4m legal dispute with the London-listed FastJet.
Five Forty Aviation alleges FastJet has failed to honour a deal to repay debts that the company guaranteed with Chase Bank in Kenya – a claim FastJet refutes.
In a statement FastJet denied it owed Avmax anything, saying: “There has never been a contractual arrangement between Avmax and FastJet plc and therefore FastJet plc does not owe any money to Avmax.
Don Smith, through Fly540 in East Africa entered into contractual relationships with Avmax and under these commercial arrangements owes money to Avmax for unpaid aircraft lease rentals and maintenance services.
A spokesman for Mr Smith wholly denied, saying that the admission document for the listing of Fastjet on AIM states that it owns 90 per cent of Fly540 Tanzania through its acquisition of Lonrho Aviation (BVI) Limited.
He said that as such, the action taken by Avmax against Fly 540 Tanzania has no implications for Five Forty Aviation or its chief executive, Don Smith. FastJet also maintained that Avmax’s notice related to a single Canadair Regional Jet parked in Nairobi, though the letter refers to three aircrafts. Asked for comment, Mr Parkin said: “I am flying to Kenya.
We have studied the documents relating to FastJet’s acquisition of Fly540 and feel there is a legal link between Fly540 Tanzania and FastJet. The Tanzania business owes us almost $2m. I plan to pursue it in court.”
The dispute over unpaid leasing bills is the latest to hit FastJet, which is also facing a £1.5m tax claim from Tanzanian authorities and claims in Kenya over allegedly unpaid fuel and maintenance bills.
FastJet was formed last June via a £55m all-share deal that saw Lonrho’s African aviation wing reverse into Aim-listed Rubicon Diversified Investments. The company was renamed FastJet – a brand owned by Sir Stelios, who was handed a five per cent stake and took a €50,000 (£43,500) per month consultancy fee. Operating in Kenya, Tanzania, Angola and Ghana, FastJet said it would “give people used to 12-hour bus rides the option to fly.”
Source Tanzania Daily News
