Arik Air Takeover: Court Fixes May 15 For Ruling

Arik Air Takeover: Court Fixes May 15 For RulingThe Federal High Court sitting in Lagos has fixed for May 15, its ruling on two preliminary objections arising from the takeover of Arik Air Limited by the Asset Management Corporation of Nigeria (AMCON).

The Corporation had on February 8, 2017 announced that it had taken over Arik Air Limited.

AMCON said the step was taken to save the airline from collapse and in the best interest of the general public, workers, creditors and other interest groups in the aviation sector.

A legal practitioner, Mr Oluseye Opasanya, was then appointed as the Receiver Manager of Arik Air Limited, following its takeover by AMCON.

By an ex parte application on February 8, AMCON secured an injunction restraining the airline’s “shareholders, directors, creditors, managers, officers, employees, servants, consultants, agents, representatives (and) privies” from interfering with Mr Opasanya’s power to manage Arik Air.

However, four persons who were aggrieved by the court order – Sir Joseph Arumemi-Ikhide, Chris Ndule, Dr. Michael Arumemi-Ikhide and Sangowawa Olubiyi – filed a preliminary objection through their lawyer, Mr Babajide Koku.

They accused Mr Opasanya and the lawyer representing AMCON, Professor Koyinsola Ajayi, of engaging in professional misconduct and urged the court to void all the processes so far filed by Professor Ajayi on behalf of the Corporation and Mr Opasanya.

The grounds of their objection was that Ajayi and Opasanya are both lawyers practising in the law firm of Olaniwun Ajayi LP.

Mr Koku argued that by virtue of Rule 17 of Professional Conduct of Legal Practitioners 2007, neither Ajayi nor any other lawyer from the law firm of Olaniwun Ajayi LP could appear in a case where Opasanya was a plaintiff.

Opposing the preliminary objection, Ajayi stated that there was a distinction between Opasanya and the law firm of Olaniwun Ajayi LP where Opasanya works, and that there was no law stopping anyone from the law firm from representing Opasanya.

He also filed a preliminary objection challenging the locus standi of Koku’s clients to file the preliminary objection.

Professor Ajayi argued that they were not parties in the suit in question which AMCON and Opasanya filed against Arik Air and the Inspector General of Police.

He described them as interlopers who should not be heard and urged Justice Mohammed Idris who is hearing the case to dismiss the preliminary objection by Koku’s clients.

After hearing both preliminary objections on Friday, Justice Idris adjourned till May 15, 2017 for his ruling.

Arik Air Take Over Is A Timely Intervention – AMCON

arik airThe Asset Management Corporation Of Nigeria (AMCON), has described the Federal Government’s take over of operations of Arik Airline as a timely intervention.

The Corporate Communications Department of the agency, revealed in a statement that the company has been immersed in heavy financial debt burden that was threatening to permanently ground the airline.

“For some time now, the airline, which carries about 55% of the load in the country, has been going through difficult times that are attributable to its bad corporate governance, erratic operational challenges, inability to pay staff salaries and heavy debt burden among other issues, which led to the call for authorities in the country to intervene before Arik goes under like many before it.

“The move, which clearly underscores government’s decision to instill sanity in the nation’s aviation sector has also prevented a major catastrophe that would among other factors protect, and preserve Arik Airlines as a going concern.

“The development will afford Arik Airlines, which is the largest local carrier to go back to regular and undisrupted operations, avoid job losses, protect investors and stakeholder funds as well as ensure safety and stability in the already challenged aviation sector.”

AMCON further revealed that the airline recently suspended its flight operations to the John F. Kennedy International Airport, New York, United States, claiming that the two Airbus A330-200 aircraft dedicated to the route have been taken to France for C check at the same time.

“Equally more than eight aircraft are currently grounded at the tarmac making it difficult to meet their routine commercial flights.

“The myriad of issues confronting Arik Air of late ranges from confiscation of aircraft due to non-payment of leases, frequent flight delays, constant fracas between Arik Staff and irate passengers at both local and international airports etc.

“During the last yuletide, passengers were stranded in airports all over the country due to Arik’s incessant flight delays and cancellations, which negatively affected the preference they enjoy from passengers. You are all living examples of this.

“The airline is so overwhelmed to the extent that the workers’ wages are not paid for several months, leading to occasional confrontation between the management of Arik and different Aviation Unions in the country.

“It was Arik’s inability to pay its workers for seven months that forced the United Labour Congress (ULC) and Engineers Union to recently shut the offices of the Airline across the country causing untold hardship to thousands of travelers and an embarrassment to the aviation sector in the country.

“Besides owing workers’ salaries, the Airline has also not been remitting the taxes of workers to relevant bodies thus also defrauding the country.

“The Airline is also in perpetual default in its lease payments and insurance premium, leading to regular and embarrassing repossession of its aircraft by lessors. Various class actions are pending against the airline all over the world.

“We assure all stakeholders that the intervention is in the best interest of the general public, workers, creditors and other aviation interest groups,” the statement read.

Arik airline would now be managed by Capt. Roy Ukpebo Ilegbodu, a veteran aviation expert under the receivership of Mr Oluseye Opasanya, SAN.

Court Orders AMCON To Pay Capital Oil And Gas 26bn Naira

Shiites, Abuja, Court-Amcon-Capital OIlA Federal High Court in Abuja has ordered the Asset Management Corporation Of Nigeria (AMCON) to pay Capital Oil and Gas Limited the sum of 26 billion Naira as contained in the consent judgment delivered in 2013.

Justice Abdul Kafarati in his judgement held that the court has powers to enforce its judgment or the verdict of any lower court in the country.

The trial judge also restrained AMCON from exercising any power over Capital Oil and Gas Limited and its assets and from processing any assignment and transfer among others.

Justice Kafarati, who resolved all four issues canvassed by Capital Oil, advised the agency to live up to its statutory responsibility of reviving the nation’s economy through positive support for businesses to thrive.

A Federal High Court in Lagos had on May 6 struck out a suit commenced by AMCON against Capital Oil and Gas Industries on the grounds that the suit was premature.

AMCOM sought to circumvent existing suits in different courts on issues relating to the alleged indebtedness of Capital Oil and Gas which was currently under dispute.

Court Orders Bank To Appoint Accountant In Case Of AMCON Vs. Jimoh Ibrahim

AMCON, Asset Management, Jimoh Ibrahim, Union BankA Federal High Court sitting in Lagos has ordered Union Bank of Nigeria to nominate a chartered accountant within seven days for the purpose of carrying out a forensic audit of statement of accounts on the alleged 50 billion Naira loan allegedly granted to businessman, Mr Jimoh Ibrahim by the bank.

The accountant will work with two other accounting firms nominated by the Asset Management Corporation of Nigeria (AMCON) and Mr Jimoh Ibrahim.

At the resumed hearing of the suit on Monday, lawyer to AMCON, Yusuf Ali (SAN), informed the court that AMCON has already nominated KPMG.

Counsel to the defendants, Chief Niyi Akintola (SAN) also stated that in compliance with the directive of the court, the defendants appointed the accounting firm of Adewale Folowosele & Associates.

The court has also ordered that the joint forensic audit is to be conducted by the three chartered accountant firms within a month at the Union Bank headquarters.

The matter has been adjourned till September 28 for a report of progress or settlement.

Justice Abdulazeez Anka had on July 11 discharged an interim order granted to AMCON to take over some assets belonging to Mr Jimoh Ibrahim.

This was after the business man had submitted that the exparte order was obtained via suppression and misrepresentation of material facts by the plaintiff (AMCON) and the order was obtained in bad faith against persons who are not parties to the suit.

The applicants had in a 24-paragraph affidavit in support of their application, deposed to by one Gbenga Onilude, a litigation officer, stated that none of the properties attached in the exparte order belong to any of the defendants; NICON Investment Limited, Global Fleet Oil and Gas Limited and Barrister Jimoh Ibrahim.

Silverbird In Negotiation With AMCON To Restore Properties Seized

SILVERBIRD, AMCONThe Management of the Silverbird Group says negotiations are on course with the Asset Management Corporation of Nigeria (AMCON) over the seizure of some of its properties.

The Group Vice President of Silverbird Group, Guy Murray–Bruce, said this on Thursday in reaction to the assets of three companies belonging to the group taken over by AMCON.

He described the whole situation as a business arrangement gone south, vowing that their properties would be restored.

AMCON had alleged that the assets were being seized following the failure of the company to settle an 11 billion Naira loan owed Union Bank and acquired by the corporation.

Freezing Of Asset: Jimoh Ibrahim Asks AMCON To Jettison Plan

court-gavelBusiness Man, Jimoh Ibrahim, has asked the Asset Management Corporation of Nigeria (AMCON) to jettison an interim order of injunction it had obtained to freeze some of his assets.

In a statement sent to Channels Television in reaction to the plan to freeze his assets, the business man said: “AMCON is aware that we keep a deposit of 86 billion Naira or £172 million with Union Bank and AMCON is aware that application to collect the money from Union Bank is pending before an Ikeja High Court.

“All of these facts, it has not disclosed to an innocent Federal High Court.

“Union Bank lost the case and went for an appeal only to reappear in the guise of AMCON loan acquisition deal not known to the new court AMCON approached for an injunction”.

He further stressed that “any action taken by the bank and AMCON before the appeal is determined amounts to an abuse of court process”.

Mr Ibrahim also alleged that asset management company had gone ahead to execute the interim order even when the Judge had not signed the execution writ.

According to him, his company has filed an application to discharge the interim order.

FG Inaugurates Presidential Committee On AMCON Loans Recovery

committee on Loans RecoveryA Presidential Inter-Agency Committee on recovery of loans granted to commercial banks and corporate organisations by Asset Management Corporation of Nigeria (AMCON) has been set up by the Federal Government.

This was revealed in a statement made available to the media on Monday by Comrade Salihu Othman Isah, the spokesman for the Honourable Attorney General of the Federation and Minister of Justice, Mr Abubakar Malami.

The inauguration of the committee, according to the Minister of Justice, was held on Thursday, May 19, in Abuja.

The committee is headed by the Minister.

Mr Malami in his speech, recounted that AMCON was established by the Act of the National Assembly to prevent the collapse of the Nigerian banking sector following the banking crisis, as a result of the Bank Consolidation Reforms in 2008.

The AGF pointed out that the above situation led to huge indebtedness for banks which culminated in the eventual purchase of the toxic loans by AMCON in order to stabilise the banking sector and by extension the Nigerian economy.

However, the debtors who cut across the aviation, banking and oil and gas sectors failed to repay the loans while some of them had resulted to court actions all in their bid to frustrate the loan recovery efforts of AMCON, surmising that in some cases, this was with active conspiracy of some financial institutions among others.

The Minister also explained that the situation led to the President’s approval and directive for the establishment of the Inter-Agency Committee to effectively pursue the loan recovery.

The Committee will ascertain the current status of AMCON recoveries in terms of achievement from inception to date, the total outstanding viz value of assets and also ascertain how government at various levels can be made to honour their debt obligations to the Corporation.

It is also to request and obtain information from any person or persons and/or entity or entities onshore and offshore, with the full support and weight of the Federal Government and her agencies towards the pursuit and realisation of the Committee’s mandate; as well as to assist in third party investigation outside AMCON office relating to obligors and identify the criminal nature of commercial transactions that would assist in pursuing criminal prosecutions.

In addition, the Committee will ascertain how government agencies can collaborate to support AMCON’s recovery effort in ensuring that payments due to Obligors are made to AMCON, consider the possibility of going into a Joint Venture Agreement with AMCON, the acquisition of forfeited assets from AMCON and the take-over of recalcitrant businesses/companies where feasible.

It is also expected to establish the working framework for the Committee such that AMCON could have direct contact with the agencies for assistance and report be made to the Committee on achievement and challenges as well as to design and come up with workable strategies to pursue aggressive recovery of the AMCON loans.

Members of the Committee include representatives drawn from the following different Ministries, Departments and Agencies.

It is chaired by the Attorney General of the Federation and Minister of Justice, Mr Abubakar Malami.

It also has as members, the Minister of State (Aviation), Senator Hadi Sirika, Inspector General of Police, Mr Solomon Arase and the Chairman, Economic and Financial Crime Commission, Mr. Ibrahim Magu.

Others are the Accountant General of the Federation, Mr Ahmed Idris, Group Managing Director Nigerian National Petroleum Corporation, Dr. Ibe Kachukwu, Director General, Debt Management Office, Dr. Abraham Nwankwo, Executive Secretary, Petroleum Products Pricing and Regulatory Agency, Mr Farouk Ahmed and the Managing Director of AMCON, Mr Ahmed Kuru.

AMCON Appoints Managers To Sell Keystone Bank

Keystone BankThe Asset Management Corporation of Nigeria has appointed managers to divest its 100% interest in Keystone Bank.

In a public notice issued by AMCON on Monday, the corporation announced the appointment of Citibank’s local unit and FBN capital as financial advisers to manage the process.

AMCON is asking prospective investors to submit bids, showing evidence of credibility and eligibility for the transaction by March 4, 2016.

Based on its audited account as at June 2015, Keystone Bank has a total assets of about 317.6 billion naira, equity of 18.9 billion naira and a loan portfolio of about 98.2 billion naira.

By December 31 2015, Keystone Bank had 156 branches across the country with four subsidiaries.

Economist Urges Nigeria To Consider IMF’s Consultation Report

Boniface ChizeaAn economist, Dr Boniface Chizea, has stressed the need for the Nigerian government to consider the reports of the International Monetary Fund (IMF) in order to achieve economic targets.

The IMF in its report looked at the rate of exchange which it pointed out that Nigeria was focusing too much on and called for flexibility.

It also advised the government to put in place a plan that will see to the closure of the Asset Management Corporation of Nigeria (AMCON), established to be a key stabilising and re-vitalising tool that will revive the financial system by efficiently resolving the non-performing loan assets of the banks in the Nigerian economy. It stated that “if the agency is left to continue, it will make the banks vulnerable”.

The report also gave a projection of 6.4 economic growth, a projection Dr Chizea pointed out could be lower or higher than the final outcome.

He pointed out that the IMF may have considered the election that would come up in 2015 before making the projection.

The report is part of IMF’s annual responsibilities to member countries. It is put together after the annual visitation aimed at knowing more about what is going on in the economy.

The IMF, during the consultation visit, held talks with some key players within the system – the Central bank of Nigeria and the Ministry of Finance amongst others.

Dr Chizea pointed out that the government must consider the winding down of AMCON, which he said was a distress resolution vehicle that was used in cleaning up some almost distressed banks’ records.

“It is left for us to decide as a nation whether AMCON has achieved the aim of its establishment. If the institution is left to be there, it will make the banks reckless. Nigeria should look at countries that have put distressed companies in place and see how they have managed the agency,” he said.

He stressed the need for the lawmakers to look at the grey areas that had been identified in the Petroleum Industry Bill and consider its passage, as it would attract more investors in the sector.

“I think there should be a stakeholders’ conference that will look at the bill and proffer solution to the issues that may have been raised,” he said.

AMCON Set To Redeem Bonds Worth N1.1 Trillion

Asset Management Corporation of Nigeria has indicated its readiness to redeem 1.1 trillion Naira for series one, two, three and four bonds held by institutions outside the Central Bank of Nigeria by the end of 2013.

At the signing of an agreement on the redemption plan that would ensure the complete off-setting of the liabilities by 2023, the governor of the CBN, Sanusi Lamido Sanusi, said that one trillion Naira for the first redemption had been received by the apex bank from the corporation.

Mr Sanusi said that the agreement would help stabilise the financial system.

“Out of the 5.8 trillion Naira worth of AMCON bonds, on December 30, AMCON will cancel 1.1 trillion Naira held by all institutions outside the CBN.

“In October 2014 AMCON will write off another 1 trillion, series five bonds, held by banks and other institutions,” he said.

Moody’s Hails AMCON Bonds Plan

Moody’s Investors Service has commended plans by Asset Management Corporation of Nigeria, AMCON, to retire about a third of its $35billion bonds and refinance the rest by 2014.

AMCON is expected to issue a bond in December to refinance the banks “entire exposure” at an interest rate of about 6 percent over a 10-year period.

The Central Bank of Nigeria (CBN) is expected to invest N3.6 trillion in the bond.

Moody’s said this will boost the country’s creditworthiness and eliminate the government’s indirect exposure to private creditors, adding that economic growth in Nigeria is resilient.

The agency’s rating for Nigeria is BA3, three levels below investment grade but Moody’s recently noted that an upgrade of the rating is hindered by corruption, weak institutions and its vulnerability to oil price drops.

IMF Report On AMCON’s Existence Is Misconstrued – AMCON MD

The continued existence of the Asset Management Corporation of Nigeria (AMCON) does not constitute a “moral hazard” or fiscal risk to the financial system, because the Central Bank of Nigeria (CBN) ensures that banks lend in a prudential manner.

This is according to the managing director of AMCON, Mr. Mustafa Chike-Obi, in an exclusive interview today with Channels Television.

Mr. Chike-obi who was responding to the IMF Article 4 consultation report on Nigeria, stated that, contrary to media reports, the international lender is not asking that AMCON be wound up immediately, stressing that the corporation will need at least seven years to complete its loan recovery activities.