December 5, 2011 / 7:50 AM / 8 years ago

UPDATE 1-EasyGroup and Rubicon to study Africa airline

LONDON, DEC 5 (Reuters) - EasyJet founder Stelios Haji-Ioannou’s easyGroup said it had entered into an agreement with British investment firm Rubicon which will see the pair study the feasibility of launching a low-cost airline serving the African market.

Under the proposal easyGroup will be issued shares in Rubicon representing 5 percent of Rubicon and will have the option to take a further 10 percent.

“It is proposed that easyGroup will become a shareholder in Rubicon and will use the services of Stelios and easyGroup’s experienced aviation management team to provide general strategic, management and branding advice on the feasibility of implementing a low cost, point-to-point, no frills, all jet aircraft business model for Africa,” Robert Burnham, the chairman of Rubicon said in a statement.

The proposal is conditional on the resolutions being approved at Rubicon’s general meeting on Dec. 13.

Earlier this year Stelios unveiled plans to set up another airline and call it fastjet, stoking tensions between easyJet management and Stelios, whose family is the largest easyJet shareholder with 38 percent.

Under the proposal Rubicon said it would hire a team of up to five aviation executives, led by Stelios, to provide branding advice which, if accepted, would lead to an agreement under which easyGroup will provide Rubicon with exclusive rights to use the brand for an initial period of twelve months.

If certain conditions are met, including the delivery of aircraft to easyGroup, Rubicon’s rights to the brand would continue on a perpetual basis.

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