Arik Air Begins Journey To Pay Debts Owed AMCON, Discusses With Middle East Based Partner

There were indications at the weekend that shareholders of embattled Arik Air may have started discussing with a major investor to partner with the airline, pay debts owed Asset Management Corporation of Nigeria (AMCON) and other creditors. learnt that although the airline shareholders have held series of meetings with other investors but has reached firm commitment with a particular Middle East-based conglomerate, which has its headquarters in Dubai with interest to do business in Africa.
It was further learnt that the company has interest in airline business, power and agriculture and has voted for these businesses and that it was attracted to Arik Air, which would serve as platform to invest in air transport in the continent especially as the continent has been projected as new bastion of hope for economic development in the world.
A source who is aware of the airline’s moves stated that Arik Air and the company started negotiation last week in London and have made some commitments and that a team has been selected by each company to continue with the negotiations, which continues this month.
The source further stated that major areas of discussion is on the shareholding and the extent of the debts, which according to the source creditors must back with evidence and also operational conditions.
According to the source, “We have been having discussions with investors and 10 days ago we had discussion with a US-based company, but we are having serious discussion now with this organisation, which is based in the Middle East because they have a package to invest in Africa and take advantage of the growing economy in the region. We have reached agreement on what I will call the sub-heads but the details will come out in our next discussion, but so far the discussion has been fruitful.”
The source continued, “They are interested in expanding our operations and will give us additional airplanes in addition to the six we ordered from Boeing; so we have to expand our operations throughout Africa and other international destinations with their partnership. They are eager to invest in Nigeria but, of course, with the support of the Nigerian government and they said that government support is crucial because you cannot really succeed in airline business without government’s support and that is necessary for them to invest in Nigeria or they will take their funds to another African country.”
Chairman of Arik Air, Sir Joseph Arumemi-Ikhide confirmed the negotiation with the Middle East based entity in an interview.
Arumemi-Ikhide ,who was on a medical trip to London, explained that the investor has started negotiating with the shareholders of the company.
He added that both parties had had fruitful discussions as negotiation progresses. learnt that some government officials are in the know of the meeting between Arik and the investor.
It was also gathered that the company is willing to build maintenance, repair and overhaul (MRO) facility in Nigeria if government gives it the needed support because it has voted funds to invest in Africa.
The source said that Arik Air shareholders are putting a strong team for the next round of discussion, which will include: Deloitte UK, Barclays Africa and UK-based law firm.
Recalled that AMCON took over Arik Air claiming that the airline  owed it N263.7 billion, a claim Arik Air denied, saying that its total debt, including that of international creditors and local debts amounted to N160 billion, which represents a 16.4 per cent of its value put at $3.2 billion by Deloitte UK in 2013.
Attempt to reach the AMCON Consultant to Arik Air, Mr Simon Tumba proved abortive as he was yet to respond to the text message sent to him on the issue as at the time of compiling this report.

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