AMCON Chief Executive, Ahmed Kuru has raised an alarm over the state of health of some local airlines in the country. The AMCON Boss noted that some Nigerian airlines are facing the risk of collapse under the weight of huge debts.
In his words:
“The industry remains in the throes of airlines burdened with debts, under administration or on the borderline of collapse.”
AMCON acquired Nigeria’s biggest airline, Arik Airline, last year because of difficulties arising from huge debts and poor corporate governance.
Nigeria’s more than 10 domestic airlines are struggling with difficulties arising from the country’s first economic contraction in a quarter of 2016, and have seen reduced access to capital and limited leasing opportunities.
In its 2017 financial reports, AMCON’s Gross earnings increased by 23 per cent to N341.8 billion, while a 21 per cent increase in interest income to N42.6 billion as well as N41 billion sale of Keystone Bank helped boost its performance even as operating expenses rose by 16 per cent.
The corporation recently announced plans to sell Aero Contractors and has appointed advisers for the divestment of Arik Airline.
AMCON was established in 2010 to buy non-performing loans and rescue lenders after the industry was threatened with collapse. It was created to be a key stabilising and re-vitalising tool aimed at reviving the financial system by efficiently resolving the non-performing loan assets of banks in the country. AMCON is also billed wound down by 2020, according to the Act establishing it.