Arik Air was ‘huge mess’, very poorly managed – AMCON

Arik Air. (Photo Credit: Punch)
Arik Air. (Photo Credit: Punch)

The Asset Management Corporation of Nigeria, AMCON, on Sunday said it had discovered deep rooted rot at embattled airline, Arik Air.

AMCON said it would require over N10 billion to fix the rot before the largest local carrier could resume full and uninterrupted flight operations to its regular routes across the country and beyond.

The asset company made the disclosure in a statement signed by its spokesman, Jude Nwauzor, in Lagos.

The News Agency of Nigeria reports that the airline was on February 9 taken over by the Federal Government under the auspices of AMCON as a result of a whooping debt profile of over N300 billion.

AMCON had directed that the airline would now be managed by Roy Ilegbodu, a veteran aviation expert, under the receivership of senior lawyer Oluseye Opasanya.

The statement noted that the situation was so bad that only nine aircraft out of the 30 in the fleet of the airlines were operational.

According to the statement, 21 of them have either been grounded, gone for C-check in Europe, or facing other challenges.

“As if these problems are not enough, the airline does not have money to procure aviation fuel for the nine operational aircrafts because no dealer wants to sell aviation fuel to Arik if it is not on cash-and-carry basis.

“This also calls for public understanding because flight schedules may be realigned based on the nine aircrafts that are available, technically sound and ready for flight operation,” it said.

The statement said it was discovered that Arik also owes its technical partners and also in perpetual default in its lease payments and insurance premium, leading to regular and embarrassing squabbles with different business partners.

“All these problems in addition to huge staff salaries, which have remained unpaid for 11 months; vendors that supply different items to Arik Air that are also owed means that Nigerians may have to tarry-a-while to allow the new management clean up the huge mess at the airline before Arik would finally resume uninterrupted flight,’’ it said.

The statement quoted Mr. Ilegbodu as reassuring Nigerians that these issues, though daunting, would be gradually resolved to enable Arik Air, which carries about 55 per cent of the load in the country recover the 21 aircraft.

According to him, once all the aircraft are back to the fleet, Arik Air will within the shortest possible time regain its pride of place as a leader among the comity of airlines in Nigeria.

He reiterated the fact that the intervention at Arik Air clearly underscores government’s decision to instil sanity in the nation’s aviation sector, adding that the move also prevented a major disaster that would have befallen the airline.

It said that the new management had settled the insurance cover for the aircraft which would have expired on February12 and also met with different trade creditors as well as aggrieved staffers.

It, therefore, called for public understanding as the management begins the tough job of ensuring that Arik is returned to full operational capacity within the shortest possible timeframe.

The former management of Arik had stated their intention to appeal the court order that ceded the company to AMCON.

“In the coming days, we will make our position known. It is a court order and we can challenge it and we will challenge it to the highest court of authority,” Ado Sanusi, Senior Vice President, Arik Air, said.


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  • dami

    This is the story of Nigeria…we do not know how to manage and grow a business…no long term focus or strategy…just to buy G-wagons and show off….I’m sure if you look at books of Nigerian banks the same rot will be found…..Nigerian manufacturers too the same thing….meanwhile foreign manufacturers in this same nigeria have innovated and continue to innovate out and over this recession…see UAC another poorly managed company…Mr Biggs across the nation is in very poor shape and a quarter to death…but Dominos is smiling to the bank, now UAC has purchased the franchise to debonairs to compete – let’s hope it won’t go the way of Nando’s.
    Nigerians we need to roll up our sleeves, knuckle down and put our backs into it…free money…oil money is no more.

    • GusO

      I second what you said. Nigerians can’t run anything long-term, even private companies because they are so corrupt that they embezzle the profits and as the article notes, pay themselves exorbitant salaries in addition to looting the company.

      • Stella Duru

        Lets focus on PPP (Public Private Partnership). This will help different sectors of the economy grow more than we expect when either government just leave management to private alone and vice versa. In ARIK airline’s case, government’s decision to intervene and instill sanity in the aviation sector and to help preserve the airline.

  • Curseless

    The problem with Nigeria is principally impunity, cronyism and out right selfishness. In the late sixties and early seventies Nigeria not only paraded impressive fleet but has top pilots in it’s rank. The army incursion came and the rest is history. Nigerian are brilliant and capable but most have been corrupted by this demon of wealth by all means. Ethiopian with no oil have relatively mastered the aviation industry as revealed by their performance. It is a shame we can not sustain any aviation industry. Cronyism must give way if we are to succeed and the idea of delaying a flight for a politician to arrive before the plane can take off is madness at high noon.I sincerely hope this team can pull off a miracle

    • Stella Duru

      Sanity will be restored in the aviation industry. This is what we hope and pray for. Now that government has intervened in Arik airline matter, operations will be stabilized. This will enhance the long term economic value of Arik Airline and revitalize the airline’s ailing operations as well as sustain safety standards, in view of Arik Air’s pivotal role in the Nigerian aviation sector. From there, the change in the aviation sector will trickle down to other areas of the industry.

  • Mary

    THIS TO INFORM THE GENERAL REPUBLIC CONCERNING; THE PURCHASE OF DANGOTE 3X CEMENT AT A PROMO PRICE OF 1000# PER BAG AND RICE (MAMA AFRICA, MAMA GOLD, ROYAL SATALLION) 10,000# PER BAG. COST OF TRANSPORTATION FOR CEMENT IS 150# PER BAG AND RICE IS 500# PER BAG. CONTACT THE HEAD OF SALES, PASTOR THOMAS AISEMOTA ON 07038534730. NOTE: COST OF TRANSPORTATION IS MADE BEFORE DELIVERY.

  • nkoyo

    We are all forgetting something here.Arik air was having all these challenges in the last 4 years yet the regulator and Ministry of Aviation kept silent on the matter . Clearly as has been asserted time and time again they were on Arumeme Johnson’s payroll and took no action against Arik. How could pilot , crew members etc who had not been paid for monthts been allowed to take Nigerians into the air? NCAA didn’t mind sacrificing the lives of the Nigerian public as long as their accounts were being well funded . This is the CORRUPTION we need to fight also . EFCC you need to look into and bring NCAA and the Ministry of AVIATION TO account for this soonest as there might be other airlines doing the same thing , so we avert any disasters. We praise God for delivering and continuing to deliver Nigeria from incompetent and corrupt government officials who refuse to do their work and not called to order by their superiors.

    • Stella Duru

      Hmmmmm. Better late than never. We should be glad that authorities in the country moved in to intervene before Arik goes under like many before it.

  • Stella Duru

    Kudos to AMCON for steeping in to resuce ARIK. Government’s intervention was timely and this has allowed operations to continue and this intervention also sorted out the insurance cover for aircraft(s) which would have expired few days ago, Sunday 12th February to be precise.
    We know the aviation industry is faced with quite a number of challenges, hence the need for PPP (Public Private Partnership). I applaud government for coming to the rescue at least to keep alive one of the very few airlines which offer aviation services.