- Says Arik and Aero do not belong to government
Managing Director of Belujane Consult and a former General manager in the Defunct Nigeria Airways, Mr. Chris Aligbe at the weekend gave his own reasons why he feels the idea should be jettisoned and advised the Minister of Aviation, Senator Hadi Sirika not to give it a thought.
According to Aligbe, the proposal mooted by AMCON CEO, Ahmed Kuru during his budget defense to the National Assembly that the Minister of Aviation should merge Arik and Aero and use them to float a National Carrier rather than starting a brand new one will not fly as both entities do not belong to the government.
Aligbe said,” There are still a few who believe that Aero and Arik are airlines that belong to the government. It is not true. If they were, they would be under Aviation not AMCON that has no statutory responsibility on aviation but rather on debt collection. Any attempt to move outside this statute will occasion international litigation that could be unresolved for many years. This is because both the original owners and creditors will head to court to challenge the Federal Government.
“Even the idea of merging two airlines which the proponents have acknowledged ‘are not doing well’ to form a new national carrier is fraught with so many intractable challenges that will make the product a disaster ab initio.
He raised some questions following the call for the merger of the two and subsequent transformation into a nation carrier, asking: Can any healthy and virile establishment be founded on the back of unhealthy and struggling entities? Will any sensible investor invest in such establishment? Where no investors come, such a national carrier will exist on 100% government equity, just like the liquidated Nigeria Airways. Have we so soon forgotten the bane of Nigeria Airways? And can AMCON’s liabilities from Aero and Arik, vicariously or inferentially, be assigned simplicter to the Federal Government? Ditto the assets? If not, then the argument of Federal Government owning two airlines – Aero and Arik fails to sail.
Aligbe further argued that in the entire three-year period of due process, Arik and Aero were never in consideration for the National carrier.
“AMCON’s proposal is therefore an unnecessary distraction at best and, at worst, an uncanny step to truncate the Nigeria Air Project, he said,” Kuru took his proposal to the National Assembly, having failed to secure consent from the Ministry of Aviation. Was it in good faith? Or an attempt to arm-twist? Any which way, the NASS has no statutory/constitutional right to compel the Ministry’s acceptance of Kuru’s fantasy. I wish public officials should know and act within statutes. Kuru’s push is outside the oversight role of the NASS, ‘he said.
He went further to ask on Kuru’s statement that ‘Arik is now positioned for profitability’ if:
“First, is Kuru sincere in his avowal? What are his indices of Arik’s profitability? AMCON took over Arik with 15 aircraft. How many aircraft has the airline now? What is the debt profile of Arik as at today? How much has AMCON recovered since it took over Arik. What is the operational status of Arik in terms of route network and schedule integrity? What about maintenance integrity which Arik had the highest rating on before AMCON’s takeover?”
He called on AMCON to publish its score-card to show the ‘great success’ it has achieved stating, “I dare AMCON to do so because, as at today, what is known is that Aero is keeping faith and in about four years’ time, it’s close to N30billion outstanding debt will be paid off while Arik is not anywhere close.
Aligbe further said that since AMCON does not possess, and is not expected to possess turnaround competence for complex organizations like airlines, AMCON, knowing this, should have engaged renowned firm of Consultants or Turnaround Management Team to engineer their quick (usually 5 years) turnaround.
If AMCON had taken this road, it would have found that at the time of take-over, Aero exhibited more turnaround symptoms than Arik, despite the fact of by “far larger volume of Arik’s debt”.