African travellers, plagued by the high fares charged by airlines targeting the business market, are a step closer to being able to fly across the continent on a no-frills budget airline.

By our top partner allAfrica

In a plan involving three companies, Lonrho's east and central African carrier, Fly540, is set to be transformed into a low-cost airline to be named Fastjet.

The three companies are Lonrho, London-listed Rubicon Diversified Investments Plc and the easyGroup, which operates the popular British low-cost airline, easyJet.

Rubicon announced in London on Wednesday that it intended buying Lonrho's aviation division for US $85 million, in a "reverse takeover" deal in which Lonrho will retain a 73.7 percent interest in Rubicon.

This follows the an announcement last week that Rubicon is entering a brand licence agreement with easyGroup in which it will acquire exclusive rights to the Fastjet brand, conditional on the reverse takeover by Lonrho.

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