LONR Lonrho

RNS Number:8432Y
Lonrho PLC
22 June 2007


22 June 2007

                                   LONRHO PLC

                          ("Lonrho" or the "Company")


             LONRHO AIR ACQUIRES TWO ATR 42-320 AIRCRAFT FOR FLY540


Lonrho (AIM: LONR), the African conglomerate with a diverse portfolio of
investments ranging from infrastructure, transportation, support services and
natural resources, announces that it has acquired two French made ATR 42-320
turbo-prop 42 seat passenger aircraft through its subsidiary Lonrho Air (B.V.I.)
Ltd ("Lonrho Air") for a total sum of $6.29m.


Simultaneously, Lonrho Air has entered into a back-to-back lease purchase
agreement with Five Forty Aviation Limited ("Fly540"), Lonrho's 49% owned
subsidiary, which operates low cost flights in East Africa, whereby the aircraft
are leased on a dry lease basis to Fly540 . This lease provides Lonrho Air with
annual cash flows of $1.32 million.


IBA Group Limited, who assisted with due diligence and have been retained to
provide technical asset management services to Lonrho Air, have given a
maintenance adjusted value for the aircraft of $7.5m, a premium on cost price of
$1.21 million.


The ATR range of aircraft is known for their versatility and capability to
operate even in difficult environments and from short airfields. ATR is
currently the most widespread regional aircraft type with more aircraft in
service with more operators than any competitor.  Low weights, along with an
advanced aerodynamic design and highly efficient engines, makes these aircraft
extremely efficient for a low cost operator. Low fuel consumption associated
with high tank capacity ensures excellent range characteristics and the
capability to fly multiple sectors without refueling.  The excellent landing and
take-off performance enable ATR aircraft to use the shorter runways set aside
for commuter operations at many airport hubs.  All these characteristics make
the ATR an ideal aircraft for operating in Africa.



This deal ensures the long term availability of good quality aircraft for Fly540
assisting in their plans to expand routes into the East Africa region.  Fly540
have grown from strength to strength since their first flight in November 2006
demonstrating the demand for low budget air travel in East Africa and the
potential that this market offers. The rapidly increasing demand for such
services makes this a high growth area of business aligning it with Lonrho's
renewed strategic focus.



David Lenigas, Lonrho's Executive Chairman and Chief Executive, commented:



"Lonrho Air has been established to support and supply aircraft to the Lonrho
Plc aviation subsidiaries and grow Lonrho's interests in this sector throughout
Africa.  These ATR's will be operated from Nairobi by Lonhro's subsidiary
Fly540. The speed at which this carrier has grown demonstrates the potential of
the domestic and regional carrier market in Africa. This  reinforces the Lonrho
Board's belief that well managed, quality local airlines servicing Africa from a
series of central hubs is a highly profitable business model. The concept
interacts ideally with the stated aims of international carriers such as BA and
Virgin who in today's markets only wish to serve the largest international
airports in Africa.



Enquiries:


Lonrho                                                +44 (0) 20 7016 5105
David Lenigas, Chief Executive                        +44 (0)7881 825 378
Emma Priestley, Executive Director                    +44 (0)7867 785 177


Pelham PR
Charles Vivian                                        +44 (0) 20 7743 6672
                                                      +44 (0) 7977 297 903
Alisdair Haythornthwaite                              +44 (0) 20 7743 6676
                                                      +44 (0) 771 472 1379



Notes to Editors:



About Fly540



Fly540 introduced its first service to Mombasa seven months ago on 24 November,
2006 and was well received by both business and leisure travellers. The airline
has since added a further three destinations including Malindi, Lamu and Kisumu
and is the pioneering low cost air carrier in East Africa. The airline intends
to expand to international destinations towards the end of 2007 to include a
minimum of three other regional destinations in East Africa and a further four
in 2008.



About Lonrho:



Lonrho Plc is an expanding conglomerate that is rapidly growing a successful
business throughout Africa. The Company is listed on the London AIM stock
exchange (LONR). Lonrho is strategically focused on the development of business
opportunities in infrastructure, transportation, support services and natural
resources. The Company has over 20,000 shareholders and substantial
institutional backing to support its mandate to build a profitable business that
plays a fundamental role in the development of the African economy.



Since 2006, the Company has invested in or acquired control of:



Hotel Cardoso - www.hotelcardoso.co.mz (retained)
Nare Diamonds - www.narediamonds.com
Brinkley Mining - www.brinkley-mining.com
Luba Freeport - www.lubafreeport.com
Fly540 - www.fly540.com
Norse Air - www.norseair.co.za
Swissta Holdings - www.swissta.com
Countermine plc - www.countermine.com



                      This information is provided by RNS
            The company news service from the London Stock Exchange
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