AMCON rules out job rationalization in Arik as Senate Committee backs takeover

The Asset Management Corporation of Nigeria (AMCON), has stated that despite the financial state of Arik Air, it does not intend to rationalize jobs as its utmost plans is to ensure that the airline takes its rightful place in the skies.

AMCON briefed members of the committee on Banking, Insurance and other Financial Institutions, Wednesday  stating that the airline is owing over 2,000 staff  between five and seven months salary arrears depending on their department and stated that negotiations were currently ongoing on how to immediately resolve the arrears.

Ahmed Kuru, Managing Director of AMCON, who made this known, stated that troubled  Arik Air owes AMCON N147 billion and that  the airline is owing other local banks at least N165 billion with foreign debts standing at $81 million.

According to him, the airline frequently relied on collection of ticket fees from passengers before they could buy aviation fuel. He partly blamed the incessant cancellation and delay of flight on the inability of the airline to buy aviation fuel.

Kuru, while dismissing claims that the Federal Government was planning to make the airline a national carrier, said it was too problematic for any government to handle.

He said: “Despite all the things we have done to ensure that Arik Air stays in business. But they have not done their part in meeting their own obligations. Arik Air is owing up to seven months salaries to workers.

“They have refused to pay salaries and also refused to ensure that their loans are repaid. We could not just sit back and allow an important airline with about 30 aircraft and covers 55 per cent of all routes in Nigeria to go down. From the records, Arik makes over N7 billion annually.

“We are talking to people to see how they can acquire the airline. They came. But when they saw the records of what was on ground, they decided to suspend everything, pending when we will resolve some of the issues bewailing it.

“We have deployed people there to manage it, pending when we can stabilize it and then bring in investors to take over. We discovered that out of the 30 aircraft of the airline, only about 10 were functional. Some of them were not in Nigeria. They have refused to meet all their obligations, even the insurance payment. They did not even have money to buy aviation fuel.

“What they did was that, they collected money from passengers and then quickly use the monies realized to buy fuel. This is how they have been running the place and these were some of the things we met on ground.