Sir Johnson Arumemi-Ikhide, founder and chairman of Arik Air, Rockson Engineering, Ojemai Farms Limited and Ojemai Investment Limited is in hot soup as his messy debts have been revealed by Asset Management Corporation of Nigeria (AMCON).
Be that as it may, Jude Nwauzor, Head of Corporate Communications of AMCON disclosed to us that: “In line with AMCON’s statutory mandate, the non-performing loans of Arik were acquired in 2011 from two distressed banks: Union Bank Plc – N71billion, Keystone Bank Limited – N14billion (transaction originated by defunct Bank PHB, Total amount N85billion.”
“The facilities were granted to Arik for purchase of additional aircraft and to refinance existing term loans. The default in repayment by Sir Johnson Arumemi-Ikhide, the principal promoter of Arik Air posed systematic threat to the banks and indeed Nigerian economy. As a matter of fact, Apart from AMCON, Arik is also currently indebted to other commercials including Standard Chartered, Zenith Bank, Ecobank and Access Bank to the tune of about N165billion.”
“Arik owe the Federal aviation agencies and regulators N26billion $11 million is owed to European aviation agencies and service providers $20million owed to Lufthansa Technique. In September 2011, AMCON in a bid to provide further support to Arik restructured Arik’s debt from N85billion to N70billion as a 9-year term loan running at 12% per annum. Other terms of the restructure include the following: AMCON to appoint a resident Monitoring Manager who shall have the authority to call for any of Arik’s records for examination. Arik to provide three-year record of its remittances to FAAN.”
“In all of these Arik defaulted on the term of the restructure and failed to make the monthly repayment as agreed. Again in May 2013 AMCON sourced N26billion of the Central Bank of Nigeria (CBN)/Power Aviation Intervention Fund (PAIF) through the Bank of Industry (BOI) on behalf of Arik. AMCON disbursed N21.38billion of the BOI loan to Arik as working capital. Out of this amount, N21.4billion was meant for reconfiguration of two aircraft from passenger to cargo carriers. This was never done as the funds were diverted by Arik management and is now the subject of EFCC investigation. Both aircraft were abandoned in the UK.”
“In December 2015, due to accrued interest and unpaid principal, a second restructuring was proposed for Arik debt to reduce the debt from N138billion to N90billion, which is awaiting CBN approval. This was proposed based on Arik’s plan to do a private placement and subsequently do an IPO within a period of six months. Based on that, they were expecting N44billion from Afrexim as a bridge. None of this happened as Arik could not comply with any conditions given for a peaceful resolution.”
“In spite of the leniency and good will and good faith demonstrated by AMCON to support an indigenous strategic business; Arik throughout the negotiations, refused orneglected to adhere to the terms of amicable settlement. However, AMCON continued to bear the burden of repaying the BOI loan at 1% interest rate without any corresponding commitment from Arik. So far AMCON has paid N9.05billion on behalf of Arik.”
“Arik vehemently refused to cooperate with the AMCON resident Monitoring Manager. Arik refused to disclose financial information to AMCON. Of all our investments in Arik, AMCON total recoveries from Arik till date is N4.6billion, which is only 3.2% of current exposure Total repayment by Arik in the last 12 months is N50million. AMCON also acquired 3 other non-performing loans of companies in which the principal promoter of Arik Air, Sir Johnson Arumemi-Ikhide has interest: Rockson Engeneering – N107billion, Ojemai Farms Limited – N8.6billion and Ojemai Investment Limited – N1.9billion.”
“This made the total exposure of Sir Johnson Arumemi-Ikhide to AMCON stand at a whooping N263.7billion. With no credible plan or effort to repay, the Federal Government mandated AMCON to take over Arik Air after meeting all legal procedures to that effect.”