Arik Air, lessor in fresh row over sale of CRJ 1000 aircraft

Arik Air, lessor in fresh row over sale of CRJ 1000 aircraft
Crisis rocking the erstwhile biggest airline in West and Central Africa, Arik Air, took another turn this week following the sale of one of its assets – a CRJ 1000 aircraft with registration number 5N-JEE.

The aircraft, last flown in 2019, was sold by its owners – Export Development Canada (EDC) and JEM Leasing Limited – to a foreign buyer, Alberta Aviation Capital Corp, who decided “to tear down the plane”.

Apparently alarmed by the development, JEM Leasing Limited has denied having a hand in the sale, and in turn called for criminal investigation of the auction.

It will be recall that the Asset Management Corporation of Nigeria (AMCON), a special debt recovery vehicle of the Federal Government, has been having a running battle operating Arik Air it placed under receivership in February 2017.

The takeover, according to AMCON, was part of measures to “save” the airline from “imminent collapse”. Six years down the line, it was learnt that Arik remains a hard sell, and AMCON’s cost-recovery measures through a new airline, NG Eagle, a stillbirth.

On the fringe, however, is the ousted Chairman of Arik Air, Johnson Arumemi-Ikide. He is angling to reclaim the airline’s headquarters in lieu of a recent Federal High Court ruling that faulted AMCON on transparency, transfer of Arik’s asset to float a new airline, and barring of Arumemi-Ikide and co. from the Arik Air since 2017.

Most recently, Arik Air (in receivership) notified the public of “the decision of JEM Leasing Limited owners of the CRJ 1000 aircraft, registered as 5N-JEE, and its financiers, Export Development Canada (EDC), to sell the airplane”.

“We equally wish to notify on the decision of the buyer to tear down the plane. Arik Air, as the lessee since 2014, operated the Aircraft pursuant to a lease agreement with JEM Leasing Limited,” the statement read in part.

By in a swift reaction, the management of JEM Leasing Limited denied its consent to sell or tear down the aircraft.

JEM stated: “For the records, Arik Air is the launch customer and only operator of the CRJ 1000 in Africa. JEM Leasing is not party to any arrangement with ‘Arik Air in Receivership’ for the tear down of the aircraft.

“The position of Cape Town Convention and the law of every jurisdiction is clear and incontrovertible regarding aircraft repossession and tear down.

“JEM Leasing dissociates itself from the purported decision and arrangements regarding the sale and tear down this new generation CRJ 1000 aircraft in its entirety, and urge the criminal investigative authorities of Nigeria to promptly investigate this asset destruction act and the claims of Arik Air (in Receivership) with regards to this false claims,” the statement read in part.

Arik Air’s management sources, however, insisted that the aircraft was sold in line with due process, as the aircraft has since left the operations of Arik and has been deregistered by the Civil Aviation Authority (CAA) in Nigeria since July 19, 2022.

A senior manager said: “The JEM’s claims are not in order. Why would NCAA de-register the airplane, if EDC doesn’t own the aircraft? EDC did deregistration. It’s not even a Nigerian registered aircraft anymore.

“As far as we are concerned, the Export Development Canada/JEM Leasing has enforced rights on their asset. Arik is just a lessee, and we notified the public because the aircraft has been in our hangar. Arik has not been using the plane since 2019.

“The Receiver Manager has no objection to the enforcement action, but Sir Johnson (Arumemi-Ikide) and his team (who by law do not represent JEM Leasing based on the information available to me) apparently oppose the action. The Receiver Manager is not appointed over the assets of JEM Leasing. He, therefore, lacks the locus to fight or sell what he does not have,” the manager said.