Safe skies yet? Domestic airlines run to AMCON for fresh bailout

Some domestic airlines in the country may be heading for another round of distress, as they groan under the weight of aviation fuel bills, which has accumulated to billions of naira.

The ailing and debt-ridden domestic airlines, about six of them, have run to the Asset Management Corporation of Nigeria (AMCON) seeking fresh lifeline running into billions of naira.

This is aside the over N130bn they already owe AMCON, which was created to absorb non-performing loans of banks after the 2009 banking sector crisis.

Punch reports that the latest request is also coming on the back of the working capital reportedly running into several billions of naira that AMCON had given to the domestic airlines so far.

Documents sighted showed that a number of the domestic carriers had written to AMCON,

listiing the names of the oil marketing companies they owed and the respective amounts.

The carriers said it had become unbearable for them to continue operating without paying the outstanding bills. Hence, the need for the lifeline from AMCON.

The Managing Director, AMCON, Mr. Mustafa Chike-Obi, confirmed that the airlines had written to the corporation seeking for assistance but declined to give details. But he said it was unlikely that the agency would accede to the request.

The AMCON boss had some months ago said the agency might not hesitate to assist airlines and other companies owing it if the assistance would help them to pay the debts.

Among the domestic airlines currently owing AMCON are Aero contractors, Arik Air, Air Nigeria, Chanchangi Airlines and IRS Airlines.

Already, AMCON has converted some of the debts owed by Aero contractors into a significant equity stake.

A top airline operator condemned the concerned airlines’ action. He said it was wrong for airlines to start seeking for a fresh lifeline from AMCON when they were already owing debts running into billions of naira.

The former General Secretary, AON, Alhaji Muhammed Tukur, said it was wrong for the airlines to look up to AMCON for another intervention.

He said it was understandable that AMCON had taken over the debt airlines owed banks but it was a sign of bad management on the part of airlines which were seeking such a fresh lifeline.

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