[size=14pt]FG to give Arik N4.5bn lifeline – Investigation[/size]
By Yemi Kolapo and Oyetunji Abioye
Wednesday, 18 May 2011


The Asset Management Corporation of Nigeria has finalised moves to give Arik Air a N4.5bn lifeline, investigation by our correspondents has revealed.


The capital injection, it was gathered, followed the acquisition of most of the airlines’ debts from two Deposit Money Banks in December 2010.


Arik’s debts, according to a source in one of the banks, were part of the non-performing loans purchased by AMCON in the first phase of its rescue programme in the banking sector.


A source close to the deal disclosed to one of our correspondents that AMCON had begun the process of restructuring the loans to enable the airline to pay. He, however, declined to mention the total amount that Arik owed its creditors.


The source, who asked not to be named because of the sensitive nature of the matter, said it was part of AMCON’s duties to buy a debt and restructure it if that would be the best way to get money out of the debtor.


He noted, “AMCON has acquired most of Arik’s debts. What the corporation is doing at this stage is to restructure those loans in a way that will enable the airline to pay without hindering its operations.


“However, the corporation has also agreed to put in about N4.5bn into the airline to boost its operations and enhance its ability to repay the loans. Remember, by buying its non-performing loans, off the banks’ books, the airline now owes AMCON.”


As regards the injection of fresh capital into Arik, Section 6 of the AMCON Act, gives the corporation the powers to “provide equity capital on such terms as the corporation may deem fit.”


“It is in the interest of Arik and the country as a whole to help the airline to stay in business. It will help to save many jobs and create employment opportunities in the interest of the economy,” the source added.


However, a top official in the aviation industry told one of our correspondents that Arik’s planes were guaranteed by export credit agencies, adding that these agencies would have to approve the loan purchase and restructuring deal.


When contacted, the Managing Director, AMCON, Mr. Mustafa Chike-Obi, refused to comment on the matter.


The Media Officer, Arik Air, Mr. Adebanji Ola, also said, “I am not aware of the injection.”


Apart from the debt owed the banks, the Nigerian Aviation Handling Company Plc had also dragged Arik Air before a court in May 2010 in a bid to recover a N227m debt allegedly owed it by the airline.


The Managing Director, NAHCo, Mr. Sule Bartes, who disclosed this at a media briefing in Lagos, had said that the company went to court after the two firms failed to amicably settle the issue.


The Nigerian Civil Aviation Authority had also written Arik over N21m cheques allegedly dishonoured by the airline’s bank.

http://www.punchng.com/Articl.aspx?theartic=Art20110518244818

Mr Arumemi should be locked up for stealing Rivers money in cahoots with Odili.

Yep

Ibime:

Mr Arumemi should be locked up for stealing Rivers money in cahoots with Odili.

You've been saying that for a few years now, however it seems that CBN, AMCON, and others don't agree with you. If they did, they would have easily taken over the company, sacked its management, etc. Instead, they see a reason to inject even more paxpayers money into Mr. Arumeni's/Odili's company

Oh, so this is where all the money came from

can anyone imagine the british govt. pumping £2BILL. into british airways ?
i doubt that.