Mixed reactions trail AMCON’s takeover of Arik Air
The News Agency of Nigeria (NAN) reports that AMCON had on Thursday taken over Arik Air following the airline’s huge indebtedness to the company and other creditors, both local and foreign.
The asset company directed that the airline would now be managed by Capt. Roy Ilegbodu, a veteran aviation expert, under the receivership of Mr Oluseye Opasanya (SAN).
Mr Olayinka Abioye, General Secretary, National Union of Air Transport Employees (NUATE), told NAN on Friday that the aviation unions were being cautious in their reaction to AMCON’s take over of Arik Air which is Nigeria’s largest carrier.
“Our position is that AMCON, which is an agency of government, has not been able to manage some of these firms the way we would have expected.
“We are not particularly pleased with the way AMCON has been managing Aero Contractors, and now it is coming to take over Arik.
“We just need to watch what is going to happen thereafter too and give them the benefit of doubt for now, ” Abioye said.
He said that the welfare of Arik Air’s employees was the number one priority of the unions, stressing that the leadership would soon meet on how to resume discussion with the new management
Also reacting, Mr Gbenga Olowo, President, Aviation Round Table (ART), said the harsh condition of doing business in Nigeria was largely responsible for Arik Air’s woes.
” We all saw it coming to Arik, and maybe others, more than a year ago.
“ART Quarter 1 breakfast meeting in 2016 appraised the very poor situation of Nigerian airlines and rose with an unambiguous communique on the way forward. This is still available on artng.org.
“Treating the Arik case in isolation will be to trivialise the magnitude of the problem.
” Going back to almost 40 years; the government airline – Nigeria Airways – failed; pioneer private airlines – Okada , Kabo, etc failed; third generation ADC, Bellview, Chachangi, Sosoliso etc failed; fourth generation Virgin Nigeria and Air Nigeria failed.
“Believe me, given same Nigerian operating environment, the national carrier yet to be born will fail,” Olowo said.
According to him, the failure of the airlines, essentially, is a Nigerian business environmental factor.
He said business and government were permanently at variance, while cost was permanently higher than income.
” Tax overburden and infrastructural deficit erodes revenue steadily. Gazetted policies that will enhance performance are not implemented. Credit is not in Nigeria business dictionary.
” Yet, Aviation is prone to the most minute situation in the economy, ranging from weather to politics and reckless holidays, ” Olowo added.
On his part, Capt. Dele Ore, a former President of the ART, said that the take over of Arik Air was very gloomy for the industry.
Ore said :”From experience, if care is not taken, that airline will be crippled for the next two years.
“There will be too many interests and distractions. The boardroom politics, shareholders and ownership tussle will bog the airline down.
“So, my own fear is for our children, friends and colleagues who may be thrown out of jobs if things are not done properly. ”
He said the owner and management of Arik Air brought the situation upon themselves by not entrenching good corporate governance on the airline and its operations.
According to him, the airline also had many expatriates on its payroll which was not really necessary.
“The debt profile is too high because when you bring foreigners here, you have to give them the best treatment and condition of service.
“What you spend on one expatriate can cater for three Nigerians who can do the same job,” Ore said.