1st LD Writethru: Zimbabwe to get new airline

London-listed investment firm LonZim has structured a deal that would see Fly540 Africa airline to start operations in Zimbabwe by September, The Herald said on Friday.

According to the daily newspaper, the company recently concluded an agreement with Fly540 Africa (BVI), a wholly owned subsidiary of LonZim plc, to have the airline commence flights in Zimbabwe.

LonZim's executive chairman David Lenigas said: "We are delighted to be able to launch Fly540 in Zimbabwe. Not only does it make sound commercial logic, but it is an important step forward for Zimbabwe and helps stimulate economic recovery.

"Good transport networks are essential for the growth of Africa, and Fly540 is delivering an international standard, quality aviation service connecting the continent," he said.

The airline, which would be run as Fly540 Zimbabwe, will operate its low cost service from Harare International Airport and is scheduled to open flights to Bulawayo and Victoria Falls on a domestic basis and Lubumbashi, Lilongwe, Lusaka, and Beira on an international basis.

LonZim said Fly540 Zimbabwe has now obtained the necessary Air Services Licence and, following completion of the arrangements with Lonrho's Fly540, it would be possible for Fly540 Zimbabwe to finalise the necessary permissions to operate.

LonZim said Fly540 Africa will receive 100,000 U.S. dollars to initiate flight operations in Zimbabwe, and thereafter a license fee of 2.5 percent of gross turnover and a monthly management fee of 35,000 dollars for managerial services.

LonZim Air has already acquired a 90-percent stake in a local company Sol Air (private) Limited for 200,000 dollars to facilitate the entry of Fly540 Zimbabwe into the local market.

LonZim said it would invest a further 4.3 million dollars ( resulting from an independent valuation) in acquiring an ATR 42 turbo prop from the Lonrho Aviation fleet to be operated by Fly540 Zimbabwe.

It would also spend another two million dollars for the operational costs associated with commencing operations and a working capital provision of 3.9 million dollars for the first twelve months.

The airline's capability was expected to be complemented by a freight service.

The new company would be an integral part of the Fly540 network that will be flying in nine African countries by the end of 2009.

LonZim said the launch of Fly540 Zimbabwe was central to its investment strategy of identifying current market opportunities in Zimbabwe and establishing companies that will benefit from the anticipated economic recovery.

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