Asset Management Corporation of Nigeria, AMCON, Friday, refuted claims that a domestic carrier, Arik Air Limited, did not default in servicing its obligations to aircraft suppliers and trade creditors before it was taken into receivership.
AMCON also countered claims that Arik had 30 operational aircraft when the receivership team took over the airline’s management, disclosing that only eight aircraft were functional.
Addressing newsmen in Lagos, Head of the Corporate Communications Department, AMCON, Jude Nwauzor, said some of the planes had been used as collateral for the owner of Arik, Sir Johnson Arumemi-Ikhide’s personal debts, leading to repossession by creditors.
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He said as at December 31, 2024, Arik owed AMCON N227,637,469,394.34 billion due to non-performance.
Nwauzor, however, warned that if AMCON was unable to recover the debt, it would become the debt of the Federal Government for which taxpayers’ monies would be used to settle.
His words: “AMCON continues to face resistance from a number of debtors who are unwilling to pay without a fight. One of these debtors is Arik Air Limited (in Receivership), an airline company owned by Sir Johnson Arumemi-Ikhide, who is also the promoter of Rockson Nigeria Limited (a power infrastructure company), Ojeimai Farms Limited, and Ojemai Investment Limited. These companies’ debts were transferred by various banks to AMCON due to their non-performance, with a total indebtedness of N455, 171, 764, 772.80 billion as at December 31, 2024.
“Arik owes AMCON N227,637,469,394.34 billion; Rockson Engineering N163,502, 837, 397.75billion and Ojemai Farms N14, 031, 457, 980.71 billion. The fact of the matter is that no matter the smear campaign he is sponsoring against AMCON, these debts must be recovered one way or the other. The leadership of AMCON knows that there is no nice way of recovering debt. For that, obligors go to any length to assassinate the characters of both AMCON staff and management, they malign the name of AMCON, intimidate, and harass our personnel with every arsenal at their disposal.
“The question AMCON would want the media to ask Sir Johnson Arumemi-Ikide is if indeed he took these loans that led the banks to sell the loans to AMCON. If his answer is yes, the aviation media should also be interested in his effort(s) at repayment.
“Arik Air Limited’s Indebtedness, Under the Management of Sir Johnson among several inaccurate claims, the founder of Arik, Sir Johnson Arumemi-Ikhide, has consistently peddled a false narrative regarding his debt to AMCON, claiming that Arik never defaulted in its payment obligations to Union Bank and feigning ignorance of the debt owed to AMCON. He has also alleged that the receivership was premature and claimed his loan was performing.
“These claims are misleading. The intelligent public must ask, if the loan was performing, why was it sold and restructured? And why did he agree to the restructuring? Did he fulfill the agreed terms? The decision to classify the loan as non-performing and to sell it was made by Union Bank of Nigeria PLC, UBN, in accordance with the Prudential Guidelines set by the Central Bank of Nigeria (CBN). Union Bank willingly offered the Arik loans to AMCON, which purchased the loans in compliance with the law.
“In a letter dated October 22, 2010, UBN informed Arik that its loans, which amounted to a staggering $474 million (approximately ₦70 billion at the time), were non-performing and posed a threat to the bank’s stability. This loan exposure was a significant factor in Union Bank’s financial challenges.
“It is important to note that beyond Union Bank, Arik’s loans were also sold to AMCON by Bank PHB (now Keystone Bank), and Sir Johnson Arumemi-Ikhide has, on several occasions, admitted to this indebtedness.
“Following the purchase of the loans, Sir Johnson willingly agreed to restructure the loans, acknowledging the debt. In any event, any challenge of the purchase of the NPLs by AMCON is statute-barred and there are provisions within the AMCON Act demonstrating that there is no valid cause of action that may arise from such a challenge.
“In any event, from 2011 to 2017, AMCON engaged in prolonged negotiations with Arik’s management (who never questioned the NPLs), but despite several financial accommodations, debt reduction offers, and restructuring efforts, Arik consistently defaulted on its obligations. AMCON was left with no choice but to consider various recovery options.
“Pre-receivership, Arik was plagued by insolvency and operational paralysis. The company’s financial condition was catastrophic. A KPMG report commissioned by AMCON revealed that Arik was balance-sheet insolvent, with a negative equity value of approximately ₦80 billion and total liabilities amounting to N289 billion as of December 31, 2016.
“Additionally, PwC Nigeria, the company’s long-standing auditors (previously appointed by Sir Johnson Arumemi-Ikhide), conducted audits for the years 2015 and 2016. These audits confirmed that Arik had been technically insolvent since 2014, with its liabilities exceeding its assets throughout 2015 and 2016, up until the commencement of the receivership in 2017. As of December 2016, Arik’s negative shareholder capital stood at N139 billion, nearly equivalent to its debt to AMCON.”
