The Asset Management Corporation of Nigeria (AMCON) will float a multibillion naira airline with planes in debt-ridden Arik Air and Aerocontactors Airlines.
Sunday PUNCH said the airline is to be named Nigeria Eagle and will commence operation by June with as many as 10 aircraft.
AMCON, which owns controlling stakes in both Arik and Aero, is said to have chosen to establish the new airline as a means of wriggling out of the multibillion naira liabilities currently hanging on the two carriers.
The debts are believed to be hindering new buyers from showing interest in the two carriers which AMCON has been willing to sell to new investors.
AMCON took over the management of Arik and Aero some years back, following the two carriers’ inability to continue servicing their debts running into billions of naira.
“The management gave us a strategy. The one we did with Bank of Industry. A lot of money was pumped into those airlines and that is why they are still standing till today. I am sure you heard when Ethiopian Airlines was rumoured to want to buy Arik.
“Why you hear of a debt profile of close to N300bn, it is very scary. If you assemble all your assets under a fresh umbrella, dealing with the thing will be easy. That is what management is trying to do. Even the idea of merging the two airlines is difficult. That is what is going on,” the paper quoted a source to have said.
“Apart from Arik and Aero, we have other aviation assets. We have something with Dana and Afrijet; there are a couple of aviation assets we have scattered here and there. These are what we want to assemble under one umbrella
“It is not going to be a merger, it is like let us say you gave Company ‘A’ about 20 buses to start a transport business on the condition that at the end of every year, it pays you N1bn. Now you decide to collect the entire money and assets and give it to Company ‘B’ and ask it to run the business because it is more responsible than Company ‘A’. That is why I said it is not going to be a merger but a strategic realignment of the portfolios.”
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