January 2019 was the month when many organisations were having conversations with their Human Resource Directors on important matters of staff recruitment. IDC was no exception. Following the conclusion of their search for a CEO, the Board announced in Lusaka on 7th February 2019 at their inaugural Board meeting that they had found the missing piece to Airline Jigsaw puzzle in Mr. Bruk Endeshaw Abebe.
Mr. Abebe has 24 years’ experience in the aviation industry and is currently Regional Director Sales and Services, Southern African Region for Ethiopian Airlines read the statement that was shared to Financial Insight by their Public Relations Head Namakau Mukelabai.
According to the press release, Mr Abede’s appointment was made in accordance with the Shareholders Agreement between the Industrial Development Corporation (IDC) and Ethiopia Airlines (ET) which provided that the first CEO would be nominated by ET and that IDC would nominate the subsequent CEO.
The Shareholders Agreement stipulated the distribution of re-birthed Zambia Airways, which according to the IDC’s press release of 20th August 2018 stated that “as strategic equity partners on the national airline project of Zambia, IDC will hold 55% equity in the carrier, with Ethiopian Airlines holding 45%”. The statement further indicated the initial financial commitment for investment that would act as start-up capital for the national carrier would be US$30 million. With the setting of the new partnership set for Zambia, it is no surprise that the CEO comes from Ethiopian airlines. This move will ensure that although Zambia’s shareholding is larger, the Ethiopian partners will deliver much needed skills transfer and tacit institutional memory of the Ethiopian airlines way of doing business which has seen them ranked one of the top in Africa.
The Board also directed the CEO to target commencement of operations of the Airline for the third quarter of 2019 which is rather ambitious considering the seed money that the new CEO has to start with. However, it is clear that their business model will most probably include leasing of aircrafts with short haul flights that will be integrated into the Ethiopian Airlines network which includes the famous Star Alliance.
With the Board reiterating the Shareholders’ quest to ensure that the Airline operates as a commercial enterprise so as to achieve viability, the new CEO will be looking to get more Zambians subscribing to the Sheba Miles Frequent Flyer Loyalty program.
On the actual strategy that the Airline will deploy, the Board now resigns its position and places all faith in the Management Team under the leadership of Endeshaw as he and his team will now be responsible for the rest of the details regarding the processes leading to commencement of operations.