Arik Air shareholders tackle AMCON

 

Arik Air shareholders tackle AMCON 

...Say aircraft fleet dips from 19  to 2 in six years 

 

Shareholders of Arik Air Limited has  tackled the Asset Management Corporation of Nigeria (AMCON) , on its alleged  mismanagement of the fortunes of the carrier put under its watch as receiver manager , saying the interventionist agency is misleading the Federal Government on its assignment to turn around the airline.

The shareholders said AMCON has mismaged the airline with its fleet comprising 17 serviceable and operational aircraft;  two air planes parked for minor maintenance on February 9, 2017 to the current fleet of only two aircraft.

Besides the dip in the aircraft fleet, the shareholders said the takeover of the carrier did not follow due process of taking inventory of assets, liabilities and proper  hand over.

The shareholders said AMCON, under  the leadership of Alhaji Ahmed Kuru ,  a senior government official, entrusted with the vital responsibility in the economic affairs of 

Nigeria has embarked on a journey to feed the public and administration with  misleading statements in order 

to justify the monumental damage  against Arik Air.

 The shareholders said AMCON in the last six years, when it forcefully took over the carrier has embarked on a desperate mission to destroy the  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 the country.

The shareholders informed 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. 

They said  with the 2010 banking reforms, the  Central Bank of Nigeria (CBN), directed the conversion of 

all local bank guarantees of foreign loans from off-balance sheet 

to on-balance sheet. 

With  this CBN directive, AMCON,  they said  took over the European Credit Agency(ECA)/HSBC finance facility

supported by the local guarantee of Union Bank Plc.

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

In a statement,  the shareholders clarified their position in the carrier. 

 It reads :" 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.

"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."

On the airline’s fleet and route network, the shareholders said Kuru exposed the depth of his ignorance and mischief by

claiming Arik owned only seven aircraft.

The shareholders affirmed :"  For the avoidance of doubt, we hereby state categorically that 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 and proper hand-over.

" Arik Air under AMCON’s receivership as at today, 20 September

2023 managed by Kamilu Omokide operates only  two  aircraft. 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 over $150M has been significantly depleted to less  than $15M. About 80 percent  of domestic routes have been shut down 

while all west coast, African and intercontinental routes of London

, New York, have all been shut down completely after  three  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."

The shareholders said contrary to Alhaji Kuru’s uninformed statements claiming engine swaps on Arik aircraft; the fleet comprise new generation

aircraft with OEM engines/warranties that do not require any form 

of engine swaps.

The statement reads :"  Again, in a desperate attempt to cover the 

mismanagement of the airline, he resorted to false information to 

the public.

"The MD of AMCON should cross check his facts as his agency never 

filed the sum of N240billion , 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."

Ir firther reads :" 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 

courts exparte order to take-over Arik , it disobeyed the same courts 

when ordered to file audited accounts.

"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.

"It is unfortunate that Alhaji Ahmed Kuru’s  eight 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."