Nigeria Considers Merging Arik and Aero to Form New Flag Carrier

May 15, 2017

There are indications that the Federal Government of Nigeria is considering merging and converting assets of Arik Air and Aero Contractors in the process of creating a new national airline.

 

According to sources who spoke to Vanguard, the option is due to the indebtedness of the two airlines. The two airlines have allegedly been unable to improve on their debt profile while still struggling to break even despite government’s intervention since their takeover by the Assets Management Corporation of Nigeria (AMCON).

 

The conversion plan, though already faulted by some stakeholders, will further reduce private domestic operations to six airlines, with the attendant debt burden and legal issues for the prospective national carrier, vanguard reports.

 

Stakeholders who are against the option of the merger have argued that it is a bad idea and urged the government to start a new national airline from the scratch, to avoid political interference and legal tussles.

 

Fully owned by the Federal Government, the defunct Nigeria Airways was the country’s flag carrier but was liquidated over mismanagement, corruption and over-staffing, with debt of about $78 million.

 

While its asset was bought over by Arik Air in 2007, no fewer than 6000 workers were still being owed severance packages to the tune of N78 billion.

 

Floating a new choice flag carrier has been on the front burner of discourses by the current administration. Two weeks ago, it appointed advisers to help set it up and develop its aviation infrastructure.

 

Top sources in the Ministry of Aviation told The Guardian at the weekend that “all options, including the rumour surrounding Arik Air, Aero, are all on the table to choose from.

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