Stakeholders Seek Amicable Resolution of AMCON,  Arik Air Shareholders’ Disagreement to Save Airline

Chinedu Eze

Some stakeholders in the aviation industry are seeking for amicable resolution of the dispute between Asset Management Corporation of Nigeria (AMCON) and shareholders of Arik Air so that the airline would continue to thrive and retain its workforce.

 The General Secretary, National Union of Air Transport Employees (NUATE), Ocheme Aba, speaking on behalf of concerned industry stakeholders and workers of the airline, said the nation’s major carrier suffered some form of financial setbacks before and after it was taken over by AMCON.

He noted that the financial setback threatens the continued existence of the airline, saying a resolution should be reached between AMCON and the shareholders on how to keep the airline operating, instead of the current litigation that may not ensure the future of the airline.

 Aba acknowledged that the fleet size of Arik Air had significantly reduced, disclosing that revenues generated were being used to pay the workers who admitted they are paid promptly and staff deductions of taxes and pensions are being remitted as at when due.

 The workers also confirmed that staff promotions are also being carried out periodically and that their salaries have been upgraded at least twice since AMCON take over, not minding that rates are still low.

 Aba said this indicated that there was still life in Arik Air and that the airline could be rejuvenated with the right business models and strategies.

Aba who addressed journalists at NUATE headquarters, Murtala Muhammed International Airport, Lagos yesterday, suggested that cooperation between AMCON and Johnson Arumemi Ikhide, founder of Arik Air was needed to resolve the imbroglio, adding that the company’s shareholders and AMCON besides the workers have the most to gain, or lose, from the state of the airline.

 “A recognition of this fact will alter the present state of adversity/animosity between the two gladiators which has been anything but helpful. If the two parties agree to work together, and appreciate the understanding of the workforce, it is our concrete belief that a pathway out of the doldrums will be not too difficult to chart,” he said.

 He noted that issue at hand was that of finance, not legal, therefore, “its resolution can only be through financial engineering, and not legal fireworks.”

 He suggested that what the owners of the airline needed was a team of financial experts, rather than a legal team, adding that at the end of the day, this is about defraying debts.

He noted that financial experts should be able to work out a viable debt scheduling, complete with proper investment plan capable of backing the debt payment plan.

 “The onus of this rests more with the owners”, he said.

 He said there was a cause to believe that AMCON should be willing to listen to a good offer in this respect, stressing that investment in the company is inevitable.

 “It is absolutely clear that Arik Air cannot move one inch out of the woods without some reasonable investment, one way or another,” he said.

According to him, in this regard, there are two options.  “There presently exists a $34 million down payment to Boeing for purchase of aircraft, which has been lying fallow since before the receivership. By cooperation between AMCOM and the owners, this money can be released as part of the debt to AMCON.

“The workers informed us that this amount can conveniently bring back five Arik aircraft that are presently out of service. This action alone will return the airline to profitable mode by which its indebtedness can continue to journey up north. “Secondly, AMCON should relax its current stance of nil investment in the airline. This posture is counterproductive to the Corporation’s chosen path of turning the airline around.

 “It does not make sense to us that after all the effort that has stabilized the airline, then the effort is made to waste by a change towards liquidation. Our honest advice is to ask AMCON to put behind the hurtful acts of the past administration which denied it the benefit of setting up the new airline of NG Eagle on the altar of personal agenda.

“We are convinced that a new, reinvigorated attitude towards the profitability of Arik Air by AMCON will serve the Corporation in good stead, and will serve the larger interest of aviation, including the workforce,” the NUATE secretary general explained.

He said the above combination would best serve the purpose of a true turnaround of Arik which would be in the interest of all.

 Aba said the incoming Minister of Aviation would have to give due consideration with view of fostering the needed synergy among all stakeholders to assure that the foregoing objectives are positively delivered in the interest of the owners, the Receivers Manager, the workers, other creditors of Arik Air, and the aviation industry at large.