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LONDON -- The shares of Fastjet (LSE: RUBI ) kept steady at 3.5 pence during early London trade this morning after the AIM-traded business said its boss had set his own pay at just 1 pound a year, joining the "thin cat" club.
David Lenigas, the executive chairman of the African airline, explained: "I am passionate about the possibility of Fastjet's ability to change Africa's GDP growth profile. I have been doing business in Africa for a number of decades now, and this is my personal way of contributing to changing life for the better in Africa."
Lenigas' pay had been 52,000 pounds a year. However, he's not exactly heading for the poor house, as he already receives 550,000 pounds a year in his role as executive chairman of Lonhro.
Furthermore, other directorates last year allowed him to collect 252,000 pounds from Leni Oil & Gas, 60,000 pounds from Solo Oil, about 51,000 pounds from Rare Earth Minerals and 8,000 pounds from Stellar Resources.
Still, any director resetting his or her salary to 1 pound does set the right shareholder tone in today's austere climate. Certainly the boards of Aviva, Barclays, and WPP, which all suffered pay backlashes this year, may want to ponder Lenigas' gesture.
Those FTSE boards may also want to look at other role models among thin-cat leaders, which include Andrew Perloff of Panther Securities, Mike Ashley of Sports Direct, and Leonard Polonsky of Hansard, each of whom collects 1 pound or less as a basic salary.
Sadly, whether Lenigas' new level of pay will help Fastjet investors make money is difficult to say. The company's first-half results showed losses of $15 million from sales of $31 million, while the firm's much-heralded low-cost flights have only been available for less than three weeks.
No doubt some Fastjet investors are hoping their company can become the "easyJet of Africa." easyJet founder Sir Stelios Haji-Ioannou owns 5% of Fastjet and provides it with consultancy services. easyJet sports a 3 billion pound market cap. Fastjet, meanwhile, is valued at 64 million pounds.
Of course, whether Lenigas' commendable salary and the prospects for low-cost airlines in Africa combine to make Fastjet a buy remains up to you. But if that 1 pound pay packet seems attractive, you may wish to consult this free Motley Fool report, which explains how smaller companies with great potential can deliver wealth-changing returns for ordinary investors. If Fastjet is tempting you, just click here to read the Fool's exclusive "millionaire" report before you hit the "buy" button.