Business Hilights
Tracking Nigeria's Headline Business News Online

Advert space

Advert space

Air Nigeria story may frustrate moves to give Arik Air N10bn lifeline

Whereas the new management of Arik Air has said it inherited nearly an empty shell of a carrier with only 10 out of the 28 aircraft in its fleet functional at the moment, aviation analysts have expressed reservations on the appeal considering how Air Nigeria blow away N35bn lifeline in few months.

It would be recalled that Air Nigeria received the highest amount from the Federal government’s bailout funds for airlines in last administration but collapsed without any clear explanation on whereabouts of the fund.

According to Mr. Ojikutu, Secretary of Aviation Round Table (ART), an industry stakeholders forum, “There are not less than two reports on the Air Nigeria probe over the vanished bailout receiving dusts at the National Assembly for years,  but nothing had been heard on it.

He decried the situation, saying until government finds answer to the abused bailout fund, any form of bailout for any aviation company will be a disservice for Nigerian tax payers.

The management of Arik Air headed by

It also said that the rot in the company would require N10bn to fix before the airline would be able to resume full and uninterrupted flight operations to its regular routes across the country and beyond.

It would be recalled that airline was on Thursday last week taken over by the Federal Government through the Asset Management Corporation of Nigeria (AMCON) due to a debt profile of over N300bn.

Just as only 10 out of the 28 aircraft in the fleet of the airline were operational, 18 were either grounded or had gone for C-check in Europe.

Even before the takeover, the company had been enmeshed in labour unions issues which created several disruptions leading to the signing of agreements with unions. It was not clear if part of the new facility demanded by the new management will be used for the settlement of the agreement.

Capt. Roy Ilegbodu who now operates under the receivership of Mr. Oluseye Opasanya, SAN, said in a statement that  “As if these problems are not enough, the airline does not have money to procure aviation fuel for the nine operational aircraft because no dealer wants to sell aviation fuel to Arik except it is on a cash-and-carry basis. This also calls for public understanding because flight schedules may be realigned based on the nine aircraft that are available and are technically sound and ready for flight operations.

“It was also discovered that Arik also owes its technical partners and is also in perpetual default in its lease payments and insurance premium, leading to regular and embarrassing squabbles with different business partners, which accounts for why 18 aircraft are off the fleet for different reasons.

“All these problems, in addition to huge staff salaries, which have remained unpaid for 11 months, and vendors that supply different items to Arik Air who are also owed, meant that Nigerians may have to tarry a while to allow the new management clean up the huge mess at the airline before Arik will finally resume uninterrupted flights.”

He however reassured travelling public that though daunting, would be gradually resolved to enable Arik, which carries about 55 per cent of the load in the country, to recover the 18 aircraft.

According to him, the N10bn intervention expected from the government will help restore sanity and prevent a major disaster that would have befallen the airline.

He averred further that the recent intervention by AMCON was in the best interest of all stakeholders, including members of the general public, workers, creditors and other aviation interest groups in the country.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More