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Lonrho stock slumps on news Fly540 Zimbabwe yet to receive AOC; Air Arabia up

2-Mar-2010

Lonrho (-9.6%) shares slumped, losing the gains it made the day prior, after its LCC subsidiary, Fly540 Zimbabwe, stated during trading it has yet to receive an AOC from the Civil Aviation Authority of Zimbabwe.

The carrier had initially planned to launch operations in Sep-2009, which was later pushed back to Oct-2009. Fly540 Zimbabwe, which is 90%-owned by LonZim, stated it would launch services as soon as possible, with the carrier currently in the process of looking for viable routes. Fly540 is to be based at Harare Airport, serving as a regional freight and passenger carrier, initially with two passenger aircraft and a single cargo aircraft. The airline project is a partnership with local private airline firm, Sol Aviation.

Also in Africa, 1time Holdings (+1.9%) shares gained, while Comair (-1.7%) declined despite South Africa’s FTSE/JSE Africa All Share Index (+1.0%) rising for a second consecutive day. The South African Government announced plans during trading to sell 10-year bonds to refinance international debt. Kenya Airways (-1.5%) was also down, as Kenya’s All-Share Index (+0.6%) also rose for a second day.

In the Middle East, Royal Jordanian Airlines (+1.1%) advanced, moving with Jordan’s Amman Stock Exchange (+0.6%). Air Arabia (+1.1%) was also up. During trading, Air Arabia awarded Botany Weaving a seven-year contract for seat fabric, curtains and carpeting for its aircraft.

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Selected African and Middle Eastern airlines share price movements (% change): 01-Mar-2010


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