Fly540's owner Don Smith has ratcheted up the stakes in his ongoing war with Fastjet (FN) by withdrawing his carrier's brand licences granted to fastjet for Angola, Ghana and Tanzania. Fly540 yesterday claimed that Fastjet still owes its USD7.7 million in licensing fees (
USD6.9 million in Tanzania, USD500'000 in Angola and USD300,000 in Ghana), a claim David Lenigas, Chairman of fastjet, disputed stating that fastjet is the
sole owner of the 540 brand (including fly540 Kenya).
Smith's move comes after Ed Winter, fastjet CEO, yesterday stated that "these isolated issues (i.e the ongoing dispute over licencing fees and monies owed) are not affecting the day to day operations of fastjet or any of our operations in Angola or Ghana that fly under a separate Fly540Africa brand."
In his letter to fastjet , Smith stated that the Fly540Africa brand was still controlled by Fly540 Kenya, and had given Fastjet a seven-day notice to comply with the licence agreement:
“As FastJet has failed to respond notice has been given to Fly540 Angola and Fly540 Ghana to re-paint their aircrafts. Also, as per licence agreement, Five Forty has written to civil aviation authorities in the three countries informing them of the withdrawal of the licence,” the CEO of Five Forty, Don Smith, was quoted as saying.
Source [Daily News]
As of yesterday, the Tanzania Civil Aviation Authority (TCCA) is understood to have not received any official word from Fly540 regarding the withdrawal of the licence.
In response, Lenigas this morning again moved to rebuff Smith claiming that Fly540 in fact had not been licenced by Lonrho Aviation, now owned by Fastjet, to sublicence the brand out.
"fastjet is the sole owner of the 540 brand (including fly540 Kenya) which it acquired through its acquisition of Lonrho Aviation in July 2012. Lonrho Aviation has held the sole and exclusive rights to the Fly540 Brand for a number of years, furthermore Fly540 Kenya have not been authorised to sub-licence the brand.
David Lenigas
Statements made by Don Smith from Kenya, a director of Fly540 Kenya, suggesting he has the right to withdraw the Brand are absolutely wrong and without foundation. The Board of Directors of Fly540 Kenya has never met to even consider this issue and this has been confirmed by other directors."
Source [fastjet]
No mention was made about any possible legal proceedings as threatened in yesterday's Fastjet press release.
The ongoing war will likely be a catalyst for fastjet's intended tie up with Fly540 rival, Jetlink Express (J0), whom Fastjet described as "a far better Kenyan partner for fastjet given our standards of safety, security and reliability."