Nigeria’s NG Eagle faces delays over AMCON debt burden

The certification of NG Eagle (XLE, Lagos) may be delayed over debts of NGN235 billion naira (USD572 million) owed by owner AMCON (Assets Management Corporation of Nigeria), according to Nigerian Aviation Minister Hadi Sirika.

In an interview with THISDAY newspaper, Sirika disclosed the debt burden included AMCON’s NGN200 billion (USD487 million) exposure to Arik Air (W3, Lagos) – currently under AMCON’s receivership – and the airline’s NGN35 billion (USD85 million) debt owed to various civil aviation agencies. The Nigerian Civil Aviation Authority (NCAA) is therefore unlikely to issue an Air Operator’s Certificate (AOC) to NG Eagle while these debts remain unresolved, he said.

“I am not sure if AMCON intends to raise another airline out of Arik, [but] I do know AMCON itself has over NGN200 billion exposure in Arik. And I know also that Arik owes all the agencies of government in aviation over NGN35 billion. So, I am not sure if a company that has an NGN235 billion deficit can start up and become another airline. I am not too sure that can happen. So, I am not the regulator, I am the Minister, but I don’t think that it will be possible for an airline to start with negative N235 billion,” the minister told THISDAY.

He underlined that any certification by the NCAA would be done by the book. “I want to assure you that the NCAA, which is the regulator, will ensure that everything that needs to be done to establish an airline, AMCON would have followed it,” he said.

Neither the NCAA nor AMCON immediately responded to requests for comment from ch-aviation.

As reported, the Nigerian Senate in mid-October called on the NCAA to suspend NG Eagle’s certification, which at that time was said to be in the home stretch, having reached the fourth of five stages. However, the Senate later made an about-turn, warning against political interference in the duties of the NCAA while at the same time apologising for interfering in the start-up’s certification process.

The call from the Senate followed on from complaints by trade unions and a National Assembly Committee on Aviation. The bone of contention appeared to be AMCON’s shift in attention to the startup instead of rescuing Arik Air. AMCON, a state-owned special-purpose vehicle for the recovery of bad loans, placed Arik into receivership on February 9, 2017.