The Nation Newspaper

Tag: Arik Air

  • Nigeria Customs Service probes $40m Arik Air aircraft deal

    Nigeria Customs Service probes $40m Arik Air aircraft deal

    The Nigeria Customs Service (NCS) has instituted an inquiry into alleged sale of three aircraft in the fleet of Arik Air Limited under the receivership of the Assets Management Corporation of Nigeria (AMCON), The Nation has learnt.

    The deal, according to  sources,  is estimated to be around $40 million.

    While the management of the airline admitted that it was cooperating with the NCS to provide details on the alleged aircraft sale, it, however, said the controversial airplanes –  Q-400, CRJ-1000 and CRJ-900 – were taken over by their foreign owners who decided to sell them to new operators.

    NCS invited the management of Arik Air over the alleged cannibalisation of the  three aircraft and subsequent re-exportation of the same machines.

    A document with the head: ‘Re: Request for Physical Inspection of Boeing 737NG. MSN: 28640, Reg No. 5N-MJI; Bombardier CRJ-900, MSN: 15059, Reg: No: 5N-JEB; And CRJ-900ER, MSN: 15058, Reg. No. 5N-JEA,’ signed by I.G. Umar, the Comptroller, Customs Intelligence Unit (CIU), and dated October 3, 2023, requires Arik Air Limited in receivership to shed more light on the deal.

    The document advised the management of Arik Air to come to the CIU headquarters for clarification.

    AMCON, however, said that it was cooperating with NCS on its investigation on the controversial aircraft.

    In what may appear as an unfolding  development, AMCON claimed that the three companies owned by the founder of Arik Air, Sir. Johnson Arumemi-Ikhide, owed it a total of N400 billion in debts before the takeover.

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    The corporation also debunked the claim that it engaged in the illegal sale of three aircraft and spare parts belonging to Arik Air after it took over the airline seven years ago.

    A statement by the media consultant to AMCON, SY&T Communications, said Arik Air, for instance, remained indebted to AMCON for over N240 billion.

    It added that Rockson and Ojemai Farms, all companies owned by Johnson Arumemi-Ikhide, are indebted to AMCON to the tune of over N400 billion.

    It maintained that rather than engage in “fruitless campaigns of calumny,” Arumemi-Ikhide should approach it for the payment of the loans.

    Besides, denied that it illegally sold some of the airline’s aircraft and spare parts as claimed by Arumemi-Ikhide.

    According to AMCON, the aircraft; Q-400, CRJ-1000 and CRJ-900 were acquired on loan by the Arumemi-Ikhide through the Export Development Canada (EDC).

    The corporation stressed that EDC served as the export bank to support the production and export of made-in-Canada goods.

    According to AMCON, Arumemi-Ikhide had approached Bombardier, a Canadian company, to purchase planes for his aviation business and approached EDC to grant loans to support the purchase request.

    The corporation stated that EDC agreed an acceptable structure to the lending requests taking into consideration Nigeria country risks, adding that the Canadian company agreed to extend loans to an entity called JEM Leasing Limited towards meeting Arik’s equipment needs.

    AMCON added that the company was registered as a special purpose company in a tax haven, while Arik had no shares in it.

    It clarified that JEM Leasing Limited, then purchased two Bombardier Q-400 aircraft with one spare engine and one Bombardier CRJ-1000 aircraft for Arik Air in the deal, which were pledged to EDC.

    It added that JEM Air Limited was fully responsible for paying-off the loan on the two planes acquired, adding that the Irrevocable De-Registration and Export Request Authorisation (DERA) were duly executed in favour of JEM Leasing and EDC.

    AMCON insisted these were duly noted by the Nigeria Civil Aviation Authority (NCAA).

    According to AMCON, Arik had paid lease sums directly to EDC in settlement of the loan obligations of JEM Leasing Limited to EDC, maintaining that Arumemi-Ikhide, on behalf of Arik (pre-receivership), had approached the Federal Government of Nigeria for a waiver of customs duty on the planes, which was granted.

    It however regretted that due to Arik’s financial difficulties, pre-receivership, the management of the airline defaulted on the lease obligations related to the Q400 and CRJ 1000 aircraft.

    The statement added: “Post-receivership, the receivership team, after initial struggles with meeting lease rentals on the planes, decided to exit the CRJ line of planes. It further agreed not to interfere with EDC’s mortgage rights over the CRJs.

    “To come to the decision, the receivership team took into consideration the history of technical availability of the planes, the lack of capital by Arik to buy or effectively overhaul engines, and the need to reduce the complexity of Arik’s operations with several aircraft types in the fleet. An independent valuation of the planes by a specialist international company was conducted.”EDC agreed to write off Arik’s outstanding lease obligations on the CRJ 1000 aircraft owed to JEM Leasing Limited, which is under its control. Compared to their valuation, this was a good deal for Arik.”EDC confirmed in a letter dated April 21, 2023, that they sold the two CRJ900 aircraft. The decision to sell was made by EDC, not the receivership team of Arik. Regarding the CR1000 aircraft, EDC negotiated with a buyer who chose to dismantle it into its constituent parts.”

    AMCON explained that JEM Leasing Limited, the alleged owner of the CRJ aircraft, had confirmed this in a letter dated May 5, 2023 that it sold the plane to a new owner who decided to dismantle the plane.

  • Arik Air’s shareholders seek dialogue with AMCON

    Arik Air’s shareholders seek dialogue with AMCON

    Shareholders of Arik Air have called for an open dialogue to resolve the airline’s differences with the Asset Management Corporation of Nigeria (AMCON).

    The shareholders said such a forum would be held in the presence of the police, the Economic and Financial Crimes Commission (EFCC), the Central Bank of Nigeria (CBN), the ministries of Finance, Justice, Aviation and Aerospace Development as well as other parties.

    In a statement in Lagos, the shareholders said they were compelled to clarify some issues that were allegedly misrepresented by AMCON to the public.

    The airline’s shareholders accused AMCON’s Managing Director Ahmed Kuru of forceful takeover, mismanagement, and destruction of Arik Air.

    The stakeholders’ statement reads: “Mr. Kuru’s tactics of approbation and reprobation to justify AMCON’s forceful takeover of Arik Air is a poor defence of his misadventure into airline.”

    On former Vice President Yemi Osinbajo’s alleged involvement in Arik Air takeover, the shareholders described this as untenable.

    They said: “Why drag the former Vice President into the theatre of confusion and shame? How would the former Vice President, a learned man of law, direct AMCON to take over a private business without being advised by Mr. Kuru? Mr. Kuru should be courageous enough to own up to the fact that he misadvised the former Vice President rather than refer to any security report.”

    On the delay of flights by the airline, the shareholders said: “It is embarrassing that the AMCON MD would attribute delays as one of the reasons for his forceful takeover of Arik Air. As much as delays are not desired and encouraged by any airline, they are inevitable sometimes due to reasons of technical, weather safety, airports’ issues, and other reasons beyond the airlines’ control.

    “Perhaps Mr. Kuru’s AMCON should take over all local and foreign airlines that may have occasional delays! We, therefore, urge him to identify those passengers that were delayed for three days by Arik Air, since he acted on their behalf. After all, he has assumed the roles of the Nigeria Civil Aviation Authority (NCAA), the Federal Consumer Protection Agency, and the law courts, which have statutory oversights on such matters.”

    “It is a fact that Arik Air disputed some bill/payments records with the Federal Airport Authority of Nigeria (FAAN). This matter is pending at the Federal High Court in Lagos.

    “Suffice it to state that during the last sitting before the AMCON takeover, FAAN’s lawyers requested for an adjournment. This matter is, therefore, subjudice. However, it cannot be the basis for AMCON takeover of Arik, except Mr. Kuru’s AMCON has assumed a status above the law courts in Nigeria.”

    Commenting on insurance payment, the shareholders said Arik Air had not defaulted in its insurance payments.

    They claimed that Arik overseas insurers, Lloyds of London, had the receipts of payments to their local representatives, Consolidated Insurance Limited, which could not access forex due to the scarcity that happened in 2016.

    “The records are available for all to see. Mr. Kuru was simply being economical with the truth.

    “Contrary to Mr. Kuru’s spurious claims, Arik Air’s shareholders never claimed to have operated 30 aircraft at any time. Arik Air’s aircraft are newly manufactured with their original engines mounted. Thus, there was no need for engine swaps, as claimed by Mr. Kuru. If there were any engine swaps, they must have been during the six and a half years of receivership by AMCON.

    “For the avoidance of doubt, Arik had 17 serviceable and operational aircraft and two aircraft parked for minor maintenance when AMCON took over on February 9, 2017. Suffice it to state that Arik takeover did not follow the due process of taking inventories of assets, liabilities, among others, and proper handover.”

    “As of September 28, 2023, Arik-in-Receivership operated only two aircraft while others have either been abandoned, cut to pieces, sold, and/or discreetly shipped out of the country by the receiver managers.”

    On the airline’s bank creditors, the shareholders stated: “We state unequivocally that as at February 9, 2017, when AMCON forced Arik Air into the receivership management of Mr. Oluseye Opasanya (SAN), the airline was not in default of any of its financial lease and operating loan obligations to any bank, including the European Credit Agency (ECA)/HSBC facility.

    “Suffice it to state that with the 2010 banking reforms, the CBN directed the conversion of all local bank guarantees of foreign loans from off-balance sheet to on-balance sheet. Thus, with this CBN directive, AMCON took over the European Credit Agency (ECA)/HSBC finance facility supported by the local guarantee of Union Bank Plc.

    “AMCON renegotiated the facility with Union Bank from a single digit to double digit interest rate without involving Arik Air management.

    “This was done arbitrarily, without recourse to the fact that Arik Air had been servicing that facility without default for about three years; a case of shaving a man’s head in his absence.

    “…We wish to encourage AMCON’s MD to crosscheck his facts as his agency did not file neither the sum of N250 billion nor N300 billion, in its claim of the airline’s alleged indebtedness in the Federal High Court in suit number FHC/L/CS/175/2017.

    “This suit formed the basis upon which AMCON obtained an ex parte order to take over Arik Air on February 9, 2017. Mr. Kuru’s claim is patently false, contradictory, and misleading. We respectfully request him to consult his lawyers to spare the public the needless overload of misinformation.

    “Contrary to the false claims of Arik aircraft seizures by Mr. Kuru, Arik had no issues with aircraft lessors and financiers. Neither was any aircraft impounded nor seized anywhere in the world until mid-2019 well into the receivership by AMCON when the lessors were not paid as directed by the CBN letter of March 14, 2017 to banks.

    “We request that both Mr. Kuru and the CBN should explain to the public, what objective and whose interest is served by the referenced CBN letter of March 14, 2017 (BSD/GDA/CON/AMC/46/008)…”

  • Arik Air Receivership – How Alhaji Ahmed Kuru, MD-AMCON Misinformed and Misled the Government.

    Arik Air Receivership – How Alhaji Ahmed Kuru, MD-AMCON Misinformed and Misled the Government.

    The attention of the Shareholders of Arik Air Limited has been drawn to press statements attributed to Alhaji Ahmed Kuru, the Managing Director of the Assets Management Corporation of Nigeria, AMCON.

    It is unfortunate that a senior government official, Alhaji Kuru, entrusted with the vital responsibility in the economic affairs of Nigeria will publicly make false and misleading statements in order to justify the monumental damage he led against Arik Air. This is a private airline that has proudly flown Nigeria’s flag around the world, while conducting its business constructively and contributing to the economic growth and development of Nigeria.

    While we wish to refrain from media assaults and trials of persons as Alhaji Kuru/AMCON has done repeatedly in the past 6 years, we are beholdenwiththe moraldutytosetthe recordsstraight, inorder to expose the desperate attempt to misinform Nigerians and distort the facts of the monumental destruction of Arik by AMCON and its receiver Manager(s). We wish to state as follows;

    The Forceful Takeover of Arik

    We state unequivocally that as at 9thFebruary 2017 when AMCON forced Arik Air into the receivership management of Mr. Oluseye Opasanya (SAN),the airline was not in default of any of its financial lease and operating loan obligations to any Bank, including the European Credit Agency(ECA)/HSBC facility. Suffice it to state that with the 2010 banking reforms, the CBN directed the conversion of all local bank guarantees of foreign loans from off-balance sheet to on-balance sheet. Thus, with this CBN directive, AMCON took over the European Credit Agency(ECA)/HSBC finance facility supported by the local guarantee of Union Bank plc. AMCON renegotiated the facility with Union Bank from single digit to double digit interest rate without involving Arik Air management. This was

    done arbitrarily without recourse to the fact that Arik Air had been servicing that facility without default for about 3 years. A case of shaving a man’s head in his absence.

    Attempt to blame the former Vice President-Not in good faith.

    It is a disservice to the nation for Alhaji Kuru to attribute Arik forceful Air take-over to the call for intervention by former Vice-President, Prof. Yemi Osinbajo while acting as President         This is a clear affirmation that it was an unnecessary intervention and an act of meddling in the affairs of a private company. We find it laughable that Alhaji Kuru would attempt to place the responsibility for AMCON’s misadventure in Arik on the former Vice President. We believe the former VP acted on the advice given by Alhaji Kuru

    Arik Air shareholders request that the AMCON MD should cite to the public the relevant section of the AMCON act which authorises or legitimises his use of security reports and hearsays of flights delays as the basis for an airline take over. Clearly this is a very poor attempt at justifying the takeover of Arik. He has simply admitted he went beyond the authority of his office and took actions that are reprimandable.

    Arik Fleet & Route Network

    Alhaji Kuru exposed the depth of his ignorance and mischief by claiming Arik owned only seven aircraft. For the avoidance of doubt, we hereby state categorically that Arik had 17 serviceable and operational aircraft and 2 aircraft parked for minor maintenance when AMCON took over on 9th February 2017. Suffice it to state that Arik takeover did not follow the due process of taking inventories of assets, liabilities etc and proper hand-over.

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    Arik Air under AMCON’s receivership as at today, 20 September 2023 managed by Kamilu Omokide operates only 2 aircrafts. The Arik Hangar in Lagos is now a static display of 14 abandoned new generation aircraft while the rest have either been cut to pieces, sold, and shipped out of the country. The spare parts inventory of Arik valued at overUSD150M has been significantly depleted to less than USD15M. About 80% of domestic routes have been shut down while all west coast, African and intercontinental routes of London , New York, etc have all been shut down completely after 3 months

    of operation by AMCON in 2017, In addition, over 3000 of Ariik highly trained manpower have lost their jobs. What an achievement for AMCON that claimed it got the best turn around Managers in aviation to run Arik in Receivership!!!

    Prior to the AMCON invasion. Arik Air had no issues with its lessors and financiers, the onus however lies with Alhaji Kuru and Mr Godwin Emefiele, the suspended Governor of CBN to explain the basis of the CBN’s letter dated 14th March 2017. In that letter, the CBN directed all Nigerian bank partners of Arik Air to discontinue the            long-standing  arrangement    for       scheduled        contracted payments on behalf of Arik to its trade/financial partners. Arik model involved the collection of all tickets’ sales proceeds by our Bankers who were mandated to ensure the first charge on all sales proceeds      were paid to lessors and multilateral lenders. This arrangement guaranteed Arik could not default on its financial obligations.

    Engine swap Claims.

    Contrary to Alhaji Kuru’s uninformed statements claiming engine swaps on Arikaircraft;the ArikAir fleet comprisesof newgeneration aircraft with OEM engines/warranties that do not require any form of engine swaps. Again, in a desperate attempt to cover the mismanagement of the airline, he resorted to false information to the public.

    Alleged Indebtedness To AMCON

    The MD of AMCON should cross check his facts as his agency never filed the sum of N240B, in its claim of the airline’s indebtedness in any court. This is patently false, contradictory, and misleading. We ask him to consult his lawyers so as to spare the public the needless overload of his misinformation.

    It is an incontrovertible fact that Arik had no issues with aircraft lessors      and      financiers,        and      neither was            any      aircraft impounded/seized anywhere in the world until mid – 2019 well into the receivership by AMCON when the lessors were not paid as directed by the CBN letter of 14 March 2017 to all banks.

    On The NG Eagle matter

    It is regrettable that Mr Kuru was economical with the truth on the issue of NG Eagle. The incorporation documents obtained from the Corporate Affairs Commission’s records shows that NG Eagle was incorporated on 11th         July 2019 with an AMCON’s employee, Mr Kamilu Omokide ( Arik Receiver Manager) as Shareholder/Director and AMCON as second shareholder with other AMCON employees as Directors         in a breach of fiduciary duties to Arik by Kamilu Omikide.

    Alhaji Kuru also did not tell Nigerians that, the registration, establishment, and expenses for the NG Eagle AOC was funded from Arik sales proceeds. The buyer of the NG Eagle is Alhaji Abdul Ahmad, an acquittance of Alhaji Kuru and bureau de change operator selling FX to Arik. This sale transaction of NG Eagle is another breach of public procurement/assets disposal protocols. The sale transaction was done in a hush hush arrangement on 20th February 2023, after a date had been reserved for judgment in the matter of Arik Shareholders Vs Kamilu Omokide, AMCON, NG Eagle & Ors at the Federal High Court Lagos. Alhaji Kuru also recently misled the Acting CBN Governor to grant a waiver for the lease and use of the Arik aircraft by the same NG Eagle without informing the Acting Governor of CBN of a subsisting order of court.

    The Federal High Court sitting in Lagos has recently ruled that the set-up of NG Eagle and transfer of assets of Arik Air to the said NG Eagle is illegal, null, and void . The court also ordered that AMCON, and its Receiver Manager to file audited accounts of Arik Air from 9 February 2017 with the Corporate Affairs Commission within 14 days of its judgement on 31 March 2023. Though AMCON used the courtsexparte ordertotake-overArik, it disobeyedthesamecourts when ordered to file audited accounts.

    AMCON Forcefully Took Over Performing Financial Obligations

    The fact remains that AMCON forcefully took over performing loans and must be made to account for its stewardship. Arik shareholders hereby challenge AMCON’s MD and the banks he claimed are owed by Arik Air to provide proof, records of the indebtedness,

    default, and demand letters from such banks. It is time to put a stop AMCON’s deception and misinformation to the Government and people of Nigeria.

    Appeal For Justice.

    It is unfortunate that Alhaji Ahmed Kuru’s 8-year tenure as the Managing Director of AMCON in a national role that should be developmental turned-out to be          a season of disruption of businesses In Nigeria. It caused heavy job losses, capital and businesses capacity deficits and unprecedented economic setbacks through some unjustifiable receiverships    and mismanagement caused by AMCON’s arbitrariness and deliberate misinformation to government.

    We, the shareholders of Arik are willing and ready for an open dialogue with AMCON     in the presence of the relevant investigative authorities including such as Police, EFCC, the CBN ,the Ministry of Justice and the Ministry of Aviation & Aerospace.

    We come to equity with clean hands and ask that AMCON do the same.

  • Arik Air: before AMCON winds down

    Arik Air: before AMCON winds down

    • By Simon Tumba

    The matter between Asset Management Corporation of Nigeria (AMCON) and Arik Air Limited is needlessly taking up public space and attracting attention. But the facts of the matter reveal a straight, one could even say, simple solution: a transparent, yes transparent, commitment of Arik Air owners to honour obligations as and when due. Call it a matter of integrity and one would be quite right. It is necessary to consider some background facts to the case.

    Arik Air was founded in 2004, by Chief Johnson Arumemi-Ikhide and began operations two years after with a great deal of expectation that it could  be the private sector answer to the badly-managed-to-death national airline, the Nigeria Airways. Indeed, the performance of the airline in its early days showed great promise. Research indicates that by August 2006 it began international flights to the Caribbean island of Trinidad and Tobago as well as to Amsterdam; by December 2008 it was flying passengers to London, and the following year to Johannesburg and the JFK in New York. By mid- 2014, Arik Air was flying to Dubai. It recorded its five millionth passenger on August 6, 2010 and its 10 millionth only two years after in September 2012. Both were on the Lagos –Johannesburg route. At the height of its glory, Arik Air was flying 55 percent of domestic flights in Nigeria as well as transcontinental routes to London and New York, according to the April 2017 edition of Financier Worldwide Magazine. For an airline that came into existence in under a decade these were undeniable achievements. But only on the face of it. 

    Leadership mantra holds that a nation rises, thrives, or fails on its leadership; so too a business enterprise. By 2016, Arik had overextended itself beyond the capability of its management in expenditure, operation, and sundry aspects of running an airline in the peculiar Nigerian environment.

    It is received wisdom that it is better –and safer- to learn to crawl before one walks. Put differently, anyone who climbs a tree from the top will have nowhere to go but down. With the benefit of hindsight, and as insiders to the management of Arik Air reveal, the company’s executive chairman, Chief Johnson Arumemi-Ikhide ran the airline in a manner that could not but bring disastrous repercussions that would attract the intervention of the federal government through AMCON.  Worse still, gross mismanagement has driven the company into receivership.

    Financier Worldwide Magazine reported that, ‘toward the end of 2016, when its troubles began to really take hold, 70 percent of its international flights were delayed. Such was the state of ill feeling around the company’s operations, in January Arik was forced to issue a plea for passengers not to attack its employees when delays and cancellations were announced. The airline currently has around 30 aircraft, but only 10 were in operation at the beginning of February [2017]’.

    Burdened by about N280 billion debt to banks and service providers, AMCON took over the airline on February 9, 2017 as a statutory responsibility under its enabling Act. AMCON reportedly said in a statement that “Arik Airline has been in a precarious situation largely attributable to its heavy financial debt burden, and bad corporate governance…that required immediate intervention”. As Nigeria’s official ‘bad debt bank’ the corporation assumed Arik debts to the tune of nearly N280 billion and appointed a management team to stabilize the operations of the airline.

    The indebtedness in naira and foreign currencies of Arik kept snowballing to, as at the date it was put in receivership, the hefty total sum of N297, 301, 356, 316.41. In what should be Nigeria’s flagship airline, the details of how this huge sum came about are as embarrassingly many as are varied. 

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    In a 16-point itemization of incontestable managerial failing, AMCON noted in its post-receivership analysis that the airline did not have adequate cash to operate for even one week, only eight of its 30 planes were functional (with a couple of them due for C checks), and it owed foreign business partners and service providers including the sum of Euro 2.4 million to SAMCO Aircraft Maintenance Limited. Aviation fuel suppliers were owed resulting in frequent cancelation of flights and in turn, multi-dimensional inconvenience to passengers. Insurance policy for airplanes lapsed and leases on some planes were outstanding for months. The 2015 – 2019 audited report by PWC which is posted on airline’s website is a testament to the affairs of Arik Air.

    Personnel matters were generally treated with levity. Besides that local and expatriate staff, salaries of all categories were owed for months, health insurance for employees expired, training schools owed and refused to grant further credit, rents on accommodation for foreign professional staff were unpaid. Mercator that managed the Passenger Service System and sale of tickets was owed millions of dollars; it stopped rendering service to Arik.  Even the internet subscription service by a local network was suspended. In sum, almost no one wanted to do business with Arik Air.

    In a detailed statement signed by its general secretary Ocheme Aba, the National Union of Air Transport Employees (NUATE) revealed how the once promising airline came to the sorry pass of receivership. 

    Beginning with a not -well -thought -out business model that included ‘absence of proper due diligence, needs assessment…and operational objectives’ through poor human resource management (‘there was no conditions of service or any HR manual known to the workers…[and] ‘personnel were hired and allocated salaries at the owners’  whims and discretion’) , to ‘financial recklessness and [a] lack of discipline whereby the entirety of revenue accruing to the Airline was seen as personal revenue and acted upon as such’,

    NUATE said that ‘the fall [of the company] was a story foretold by its own methods’. Mismanagement of Arik even appears to border on the criminal because ‘personnel taxes and pensions were being statutorily deducted but not remitted, nor saved’. 

    The group should know because its members were insiders to the running of Arik.

    The shareholders of Arik appear eager to have their company back, and to this end made proposals on two occasions in 2018 and 2022. Despite a near 60% discount on the debt, Arik Air owners were unable to pay. Now with a new administration, the owners of Arik Air gleefully want to take back the airline for free after the winding down of AMCON. 

     AMCON is a public corporation that is responsible solely to serve public interest in the fulfilment of its mandate. Having injected some public funds into Arik with the purpose of stabilizing the airline in the early stage of the receivership, among other functions, it cannot, and will not succumb to the machinations of  persons, no matter how highly placed or well connected, to prevent it from doing its job of recovering debts. The facts about Arik Air are in the public domain for anyone who seeks the truth of the matter. The bottom line is that the shareholders should come into negotiation with a transparent mind, a preparedness to redeem their corporate indebtedness so that public monies expended on the airline is returned to public treasury. It is not AMCON’s money but Nigeria’s money for Nigerians. It should not benefit a handful of greedy, arrogant ‘mismanagers.’

     It is bruited that AMCON that has sustained Arik Air to date may be wound up. If this is true, and before it is done, the minister of finance, Wale Edun should, in the context of the provision of the extant constitution, ensure that all indebtedness is fully negotiated and paid.

    •Tumba is an aviation industry analyst and media relations expert.

  • Arik Air: Tragedy of a rogue receivership by AMCON, implications for Nigeria

    Arik Air: Tragedy of a rogue receivership by AMCON, implications for Nigeria

    • By Olalade  Gbajumo

    It is no longer news that on February 9th, 2017, Mr Oluseye Opasanya. SAN armed with an order of the Federal High Court and two lorry loads of policemen in a gestapo-like operation dislodged the management of Arik Air Limited. He ostensibly took the airline into receivership without any form of inventory taking process at least to fulfil the fiduciary duty and protect the interest of the airline.This approach and attitude  is no doubt for a very senior lawyer of Opasanya’s standing, very unethical, unprofessional.It makes a mockery of corporate governance for a receivership to be executed on a very important business like  Arik Air in such a manner.

    However, what has  turned out to be news now, is the controversy upon which this receivership was built. After 6 years of this receivership, the receiver manager could not file audited financial reports of the company with the corporate affairs commission – even when so ordered by the same federal high court. 

    The management of Arik Air had always insisted that it did not default at any time in servicing its obligations to aircraft suppliers and trade creditors.This is  despite the limitations imposed by the CBN in accessing forex.  It is on record that AMCON forcefully took over a performing aircraft financing facility where Union Bank Plc provided a local guarantee without any cash contribution – 3 years into the life of the transaction. This action by  AMCON  was purportedly at the instance of a CBN change of policy which has ended up doing more harm than good to the Nigerian economy and the psyche of any prospective investor in Nigeria.

    It is sad and shameful that the alleged indebtedness and the purported default in the servicing of that loan on which this receivership was built is just a hoax.This was a ruse and a conspiracy by some persons on a campaign and mission to dispose some Nigerians of the businesses they painstakingly built as well as to destroy their hard-earned goodwill and reputation. They have undoubtedly  made a very not-so-smart use of the law – via the passage of the revisions of the very infamous AMCON  act.

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    Recent revelations by insiders show that the much touted magic word- eligible bank assets used to justify the takeover of owners interest in the name of receivership is in ARIK’s case not  ineligible after all. 

    A letter dated August 2011 written by AMCON itself confirms that the foreign bank facility which it forcefully took over was not due after all, as it was restructured till 2021. The fundamental question is why forceful take into receivership four years before it was due? ( 2017) without any ostensible and incontrovertible proof of default in servicing the said facility.

    Consequently, in a shocking and deeply troubling series of events, the schemed receivership of Arik Air, once a prominent Nigerian airline, has transformed it into an egregious case of enterprise fraud. The airline, which was once a symbol of national pride, now finds itself mired in a scandal resulting from greed, mismanagement, and a severe lack of aviation knowledge propelled by amcon employee tasked with the management of the airline in receivership.

    The willfully organized serial rape on the assets and goodwill of Arik Air is the handiwork of Mr. Kamilu Omokide, who schemed out Oluseye Opasanya,the court appointed  receiver manager. It is not surprising therefore, that all plans were skewed towards the erosion of the shareholders’ value to gratuitously create a new called NG Eagle by the visioners and executors of the forceful takeover.

    Otherwise, how else can one explain the creation of NG Eagle Airline by Omokide and his employers -AMCON from the assets of Arik Air Ina brazen show of opportunism and conspiratorial conflict of interest, Kamilu Omokide formed a new airline NG Eagle as a shareholder/Director and Director, while serving under law as the Receiver Manager of Arik Air. 

    In hindsight as typical of the unveiling of a back story………it now makes a lot of sense.

    The Asset Management Corporation of Nigeria (AMCON) said it  took over the assets of Arik Air and sacked its management on February 09, 2017 , ýIt claimed the airline, has been going through difficult times that are attributable to its bad corporate governance and erratic operational challenges. Including  “…. inability to pay staff salaries and heavy debt burden among other issues, which led to the call for authorities in the country to intervene before the airline goes under like many before it,’’ according to AMCON spokesperson, Mr. Jude Nwauzor. Yet till date ,no undisputable records of default of these loans are before any court in the land .

    Sen. Hadi Srika, former Minister of Aviation, in another statement, explained the rationale behind the intervention of the government in the airline.: “We believe that this takeover is timely and will stabilize the operations of the airline. This will enhance the long-term economic value of Arik Air and revitalize the airline’s ailing operations as well and sustain safety standards, in view of the airline’s pivotal role in the Nigerian aviation sector. ’According to the minister, all necessary steps have been taken to ensure that there will be no undue disruption of the airline’s regular business operations or activities of stakeholders, on account of the recent changes in its leadership. 

    Yet the Honorable Minister Hadi Srika enabled the destruction of Arik, strategic player in the Nigerian aviation industry under his own leadership to pave way for his Nigeria Air project. Another story for a man biting his nose to spite his face dreaming of looking good.

    Today the rest is history, the Arik Air with 19 serviceable aircraft that fully serviced all domestic-Nigerian routes including west/central Africa, London, Dubai, New York, and Johannesburg- now under Kamilu Omokide operates only 2 aircrafts. The rest have been cannibalized, stolen or sold. The Arik Hangar in Lagos is now a static display of abandoned new generation aircraft. What an achievement for AMCON.

    The Regrets…….

    It is a shame that, Nigeria has been dragged into disrepute by the greedy scheming of this receivership. This whole arrangement has presented us as a wholesomely irresponsible and unprofessional lot to the world especially to such multilateral lenders as USExim Bank, Export Development Canada, European Credit Agencies, AfriExim, HSBC etc.

    Last Line…………

    Nigeria continues to seek foreign direct investments daily while it continues to disrespect global best practices, international treaties and conventions governing bilateral and multilateral trade and the rule of law by the actions of some agencies such as AMCON etc. The globetrotting by the government may just be a nonstarter or have we all forgotten that these countries have diplomatic and business delegations in our country that will give dispassionate feedback to the international investment communities?

    The President Tinubu administration should urgently call to account all the receivership transactions under AMCON. By this he will reassure the international business community that he is truly ready for business and such investments therefrom will be guided by law in its true sense and not beholden by the shenanigans of roguery management and criminal exploitation of law.

    Until President Bola Tinubu cleans up this AMCON  kind of mess, improve ease of doing business, and assures security of investments from usual systematic disruption caused by haphazard policies.  *Naija just dey play!!*

    •Gbajumo, an aviation investment consultant and public analyst, writes from Lagos.

    Gbaju_ololade@hotmail/co.uk

  • Arik Air introduces fly- to- vote promo

    Arik Air has introduced a N16, 000 fly- to -vote promotion to encourage Nigerians travel to their respective wards to cast their votes in the rescheduled elections.

    The promo also covers the Governorship and State Houses of Assembly Elections holding across the country on February 23, 2019 and March 9, 2019 respectively.

    Read Also: Arik Air resumes Warri flights

    The N16, 000 promotional fare is the one-way ticket cost to any domestic destination on Arik Air’s network and customers must present a valid Permanent Voters’ Card (PVC) at the point of purchase and at check in to be eligible to fly.

    The fly- to- vote promotion is available for sale from Monday, February 18, 2019 till Tuesday, March 11, 2019 for travel between Thursday, February 21 and Tuesday, February 26, 2019 as well as between Thursday, March 7, 2019 and Tuesday, March 12, 2019.

    Elaborating on the need for the promotion, Arik Air’s Chief Executive Officer, Captain Roy Ilegbodu said: “We have put this promotional fare in place to ameliorate the effect of the postponement on the traveling public and encourage voter participation.”

     

     

  • Arik Air notifies passengers of flight disruptions

    The management of Arik Air says there will be slight disruption of flights during the Yuletide, due to  operational issues and adverse weather conditions.

    In a statement signed by the airline’s media consultant, Mr Simon Tumba on Thursday in Lagos, the airline said the adverse weather would affect coastal areas, especially Benin, Enugu, Asaba and Warri.

    “Therefore some flights may either be rescheduled or cancelled, subject to aircraft and airport closure time constraints.

    “We regret the inconveniences this disruption will cause our customers and want to assure them of our sincere efforts to reducing the impact to the barest minimum.

    “Our staff shall contact customers affected by this disruption, making alternative arrangements for them or refunds as the case may be,” Tumba said.

    He assured passengers that the airline considered their safety and that of its crew as paramount, adding that the airline would only operate safe and secure flights.

    Tumba said all hands are also on deck to make all flight experiences pleasurable.

    Read Also: Arik Air resumes Warri flights

    The News Agency of Nigeria (NAN) reports that the Nigerian Civil Aviation Authority (NCAA) had on Nov. 25 issued an Advisory Circular to all pilots and airline operators to take certain precautions, due to the adverse weather conditions.

    The circular, signed by the Director General of the NCAA, Capt. Muhtar Usman, urged them to adhere to the Nigerian Civil Aviation Regulations (Nig.CARs) during flight operations in adverse weather conditions.

  • Domestic Flights: Travellers decry high price of air tickets

    Travellers on the domestic routes were on Friday hit with a drastic increase of air tickets, due to shortage of flights by local airlines. Shortage of flights is due to the reduction in number of aircrafts being used by domestic airlines in recent weeks.

    Some of the airlines said their aircraft were currently out of the country for maintenance purposes, while others claim that their planes were unavailable due to “operational reasons’’.

    However, the few operational airlines, as well as travel agents, have taken advantage of the situation to jack up their air fares, to the chagrin of intending travellers.

    The airlines operating at the General Aviation Terminal (GAT) include: Arik Air, Air Peace, Overland Airways, Dana Air, Max Air, Medview Airlines, Arik Air (PH).Others are; Aero Contractors and Azman Air, which operate at the Murtala Muhammed Airport 2 (MMA2).

    A NAN aviation correspondent, who monitored the situation at both domestic terminals, observed that some travellers were stranded, due to their inability to get seats on the available flights.

    Also, the counters of Arik Air, Azman Air, Dana Air, Max Air, Aero and Air Peace witnessed a large number of passengers trying to book and pay ahead, in order to secure their seats.

    Air Peace Economy Class one way ticket on the Lagos-Abuja route, was being sold for N32, 700, as against N25, 500 before the flight shortage.

    Similarly, a Lagos-Port Harcourt one way ticket was selling for N42, 700 as against the previous fare of N35, 000, while Lagos-Uyo one way, was sold for N42, 700 as against N30, 700.

    An Arik Air economy class one way ticket from Lagos-Abuja was sold for N27, 548 as against N22, 560, while Lagos-Port Harcourt one way, was sold for N39, 000, as against previous fare of N30, 700.

     

    Read Also: Fuel scarcity: More domestic airlines cancel flights

     

    Mr Chris Iwarah, Air Peace Corporate Communications Manager, told NAN that five of the airline’s aircraft were pulled out of service for C-Checks abroad.

    Iwarah, in a statement, said the carrier was concerned about reports of shortage of scheduled flights across the country. He said that the airline was ready to do everything within its capacity to ease the pain of air travellers.

    “We urge members of the flying public not to entertain any fear. Most of our aircraft that went for C-Check will soon begin to return, to join our operations.

    “We are soon going to schedule more flights and deploy more aircraft across our domestic routes.“We have also made plans to cater to the upsurge expected during the Yuletide.

    “A lot of flights would be scheduled from around Dec. 17, to seamlessly take those travelling for Christmas and the New Year to their destinations.

    “As an airline, we prioritize safety and place a premium on the lives of our valued passengers and crew.

    “We have undertaken comprehensive maintenance of most of our aircraft to ensure their readiness for our end-of-year operations,’’ he said.

    On his part, Mr Kingsley Ezenwa, Media and Communications Manager, Dana Air, told NAN that the airline was currently undergoing re-certification by the Nigerian Civil Aviation Authority (NCAA).

    “We are currently undergoing re-certification which hopefully will be concluded in two days. As soon as we conclude, more flights will be available,’’ he said.

    Two travellers, Mr Peter Olaoye and Mr Ijeomah Ikechukwu, expressed concern over the shortage of flights. They urged the airlines to find lasting solutions to the problem, especially as the festive period was approaching.

    (NAN)

  • Arik Air resumes Warri flights

    Arik Air said Thursday that it will  resume flight operations to Osubi Airport, Warri with effective  Friday, October 26, 2018 following the reopening of the Airport closed on September 3, 2018 by Nigeria Airspace Management Agency (NAMA).

    Its spokesman, Adebanji Ola disclosed this in a statement.

    Read Also: Arik Air resumes flights from Abuja to Calabar, Uyo

    According to him, Arik  Air operates two daily flights from Lagos to Warri and one flight from Abuja to Warri. He said flights into Osubi are  also resuming same day.

    Also speaking , its Chief Executive Officer, Captain Roy Ilegbodu, said the airline is pleased  to welcome passengers back on the Lagos-Warri and Abuja-Warri routes with a promise of on-time departures and great customer experience. 

    Arik Air recently launched its Mobile App to further boost customer experience. Free to download on Google Play store and IOS App Store, the app presents consumers with an intuitive, easy-to-use interface.

  • Arik Air aircraft aborts take-off at Benin Airport

    An Arik Air aircraft operating from Benin Airport to Lagos Airport on Tuesday aborted take-off when the Pilot-in-Command observed an abnormality during the process.

    The Communication Manager of Arik Air, Mr Ola Adebanji, confirmed the incident in Lagos.

    Read Also:Smoke in Arik Air plane forces pilot to declare emergency on Accra-bound flight

    Adebanji explained that the aircraft, a Bombardier CRJ900, was brought under control on the runway in the process with no damage to the aircraft and no injury was sustained to the passengers on board.

    “After the situation was brought under control, in which there was no casualty to the passengers, an alternative aircraft was immediately provided to fly the passengers to Lagos.

    “The aircraft has since been ferried to Lagos for appropriate checks and observation and maintenance,” he said.

    Adebanji said the airline apologised to its passengers for the inconveniences that occurred during the incident.

    He restated the airline’s commitment to maintaining the highest safety standards.