AMCON’s Impact on Ownership of Nigerian Airlines
Friday, 13 July 2012
With the debt recovery of most Nigerian airlines, the Asset Management Corporation of Nigeria (AMCON) can decide the ownership structure of these airlines to ensure their continued existence and profitability, writes Chinedu Eze
An industry expert, who specialises in aviation law, recently quipped "Let the truth be told, AMCON owns all the airlines in Nigeria now".
This assertion is buttressed by the fact that AMCON has taken over the non-performing loans of eight Nigerian airlines worth N135 billion, according to the Managing Director of the Corporation, Mustapha Chike Obi.
With such huge indebtedness, technically the Corporation owns these airlines and that gives the Federal Government a window of opportunity to take critical decision on how to sustain them and ensure their continued existence by deciding their ownership structure.
The aviation lawyer condemned any plan by government to float a national carrier and joined many others in the industry to say that it cannot work this time.
He argued that as the airlines have been reluctant to work together under merger or acquisition, AMCON can now help them to take decision about their future existence.
"As far as I am concerned, it will be the biggest mistake for government to go and establish a national carrier. No, what should be done is that, for example, right now, let the truth be told, AMCON (Asset Management Corporation of Nigeria) owns all the airlines in Nigeria.
"AMCON can now open those shares to the public. And AMCON can now force mergers but let the owners participate in the process. But it will be wrong for government to say we need a national carrier," he added.
He noted that government has not shown any sincerity in encouraging the growth of Nigerian airlines, dismissing intervention fund as merely sharing money, which allegedly most of the airlines divert to other businesses and suggested incentives government could give the airlines, which are obtained in other parts of the world.