London-listed fastjet plc is set to dispose of its 49% stake in its Tanzanian subsidiary, Fastjet Airlines Limited t/a Fastjet, on the back of an increasingly difficult operating environment.

In a statement to The Citizen newspaper, the Tanzanian LCC confirmed Lawrence Masha had been appointed its first executive chairman.

"Mr Masha will be working closely with the company’s management team to oversee the smooth operation of the airline and the (equity) buyout which is currently in progress,” Fastjet Tanzania general manager, Derrick Luembe, said in a statement to the newspaper.

fastjet plc's largest shareholders include South Africa's Solenta Aviation Holdings Ltd., M&G Investment Management Ltd., Majedie Asset Management Ltd., Henderson Global Investors Ltd., Liberum Capital Ltd., J.O. Hambro Capital Management Ltd., GAM International Management Ltd., and the Fastjet Plc Employee Benefit Trust.

Fastjet was not immediately available for comment.

The move follows fastjet chief executive Nico Bezuidenhout's recent warning that it may exit the Tanzanian market given an increasingly predatory Tanzanian state. Among the issues hampering Fastjet Tanzania's operations included weakening yields, brought on by Air Tanzania's decision to deploy its B787-8 onto domestic routes, as well as regulatory delays.

"What has been especially challenging is that we have been competing with a B787 for the last couple of months in Tanzania adding 280 seats on one of our flight sectors. That has been tricky to respond to, we've seen fare levels in the past two months come down quite drastically as the airline tries to fill those seats," he told Jon Howell, Managing Director of AviaDev Africa, in an interview in September. "Its a tough environment. We've made the hard decision to suspend funding to our Tanzanian operation. And it wasn't a decision we made easily."

fastjet plc has struggled to raise sufficient funding from its shareholders over the past twelve months. In September last year, a call to raise USD44 million in fresh capital garnered a response of only USD28 million as shareholders became increasingly reluctant to invest money in the business. In late October, Bezuidenhout again warned that unless the company was able to carry out an equity fundraise and/or reach an agreement with its key creditors "in the coming days", it would no longer be able to operate as a going concern.

As it stands, Fastjet Tanzania operates two E190s on scheduled flights connecting its Dar-es-Salaam base with Kilimanjaro, Mbeya, and Mwanza in Tanzania as well as to Harare Int'l and Lusaka internationally.

No mention was made as to the potential fate of fastjet plc's other certificated African carrier, Fastjet Zimbabwe, where it owns a 49% stake, or its virtual carrier brand, Fastjet Mozambique where it holds a 99.25% stake.