Fastjet off - loads Fly 540

Africa low-cost airline fasjet, which is backed by easyJet founder Sir Stelios Haji-Ioannou, has off-loaded its share of Fly 540 Kenya to the airline's director Don Smith.Fastjet said the agreement wholly removes Fly 540 Kenya from the fastjet group.

All legal and financial ties between the two companies have been dissolved and each group has indemnified one another against any and all liabilities relating to the segregation of the businesses, said fastjet. Ed Winter, fastjet interim Chairman and chief executive, said: "Following a period of complex negotiations, we are delighted to have achieved a successful outcome for all parties.

"After a thorough and lengthy evaluation of Fly 540 Kenya, we concluded that converting the business into the fastjet low-cost model would not be economically viable "Disposing of our investment in Fly 540 Kenya allows us to pursue our priority objective of creating fastjet Kenya as a new entity which will operate to the same low-cost model, international standards of safety, reliability and punctuality as fastjet Tanzania and utilise the same commercial strategy and distribution platforms.

"Further information on the Company's plans to launch fastjet Kenya will be announced in due course."

The disposal of Fly 540 was for "a nominal sum". Most of fastjet's investment in the carrier has already been written down but a further US$10 million will be written down in the full year accounts for 2013, said the airline.