National Carrier: How Nigeria fell to grand deception By Chris Aligbe

•Richard Branson

•An aviation activist, Capt Jerry Agbeyegbe went to court, seeking to stop Virgin Nigeria, but four days to the case coming up, Agbeyegbe was murdered in cold blood, a murder that remains, unexplained and unsung till date.
•This criminal act of deliberate concealment, never experienced before in the banking history, and perpetrated by an otherwise perceptively reputable foreign investor-group, left GTB no option than to head to the court to force payment. The US$15million is today part of the unsecured N35billion debt stock of Virgin Nigeria held by AMCON, which Nigerian tax payers have to liquidate.

Did President Olusegun Obasanjo knowingly or unknowingly yield to the grand deception that cost Nigeria billions of Naira? Did he and other government  officials also knowingly or unknowingly take decisions that killed Nigeria Airways rather than revive it? Aviation consultant Chris Aligbe who was Corporate Affairs Manager of Nigeria Airways concludes the special report we started last week. It’s a story that could help President Buhari as he attempts to revive our national carrier.

Kema  Chikwe’s Air Nigeria – (2001): Our Failed Attempts

Having secured a victory over IFC and BPE and indeed the touted hope of Atiku to acquire Nigeria Airways through the “New Co”, Dr. Chikwe proceeded to float her own brand of national carrier.  The airline was to be called Air Nigeria. The floatation process was carried out in a shroud.  The core investor was “Air Wing Aerospace”, a Special Purpose Vehicle incorporated in UK with one British Pound as paid-up equity.

They came into the country with no funds to invest, neither did they have capacity to attract investors.  They had no start-up funds.  Yet, they were to hold 40% equity of Air Nigeria.Two Asians of unknown character and pedigree were behind Air Wing Aerospace.  The duo claimed a relationship with Singapore Airline.  They indeed claimed having worked with the airline and that they were bringing Singapore Airline as a Technical Partner.

Intriguingly, so many things went wrong from conception.  Some of these include:

  • Air Wing Aerospace was appointed 2 months before it was incorporated.
  • Not having any track record or financial resources as investors, Air Wing Aerospace was handed over six Nigeria Airways prime properties by the Minister as collateral to raise start-up funds from Nigerian banks.
  • Without even an Air Transport License, let alone an aircraft, acting on the order of the Minister, the NCAA, under the headship of late Engineer Oyudo, issued an Air Operating Certificate – AOC to a non-existent airline in the name of Air Nigeria: an action that attracted severe criticism and chastisement by ICAO.
  • The roadmap and objectives were not clear. Was it a Turn-around of Nigeria Airways or an imitation of Joji’s concept? Everything was shrouded in secrecy.
  • What was very clear was that the two Asians who told Nigerians at the National Assembly Public Hearing that they were technopreneurs, had no iota of knowledge in airline operation, let alone floatation.

By the 2nd quarter of 2002, industry outcry over Air Wing Aerospace had assumed an unimaginable dimension to the extent that the Awaal Tukur-led House Committee on Aviation instituted a Public Hearing on the issue. This was after he carried out a due diligence on the two characters, one of the results of which was a letter from Singapore Airline denying ever knowing any of the two impostors.

In fact, the Air Wing Aerospace point man was a former Pakistani policeman called Mohammed. The 2-day Public Hearing was very heated as it pitched legislators’ political interests against each other.  Some were honest about the spirit and intention of the Hearing while others saw it as a battle field to settle scores between the then Speaker, Rt. Hon. Ghali Naaba and the President – OBJ, during the impeachment saga.

In spite of the political colouration by perceived “OBJ Boys” and “Ghali Naaba Boys”, the Hearing was very revealing as it exposed Air Wing Aerospace and the Pakistani duo as fraudsters and conmen.  It also exposed the inadequacy of the Ministry in areas of due diligence, airline floatation and transparency.

Not long after the Hearing, the Minister had no choice than do the needful.  She terminated the Air Wing Aerospace agreement on grounds of non-performance.  Thus, ended the fourth attempt to float a National Carrier.

Kema Chikwe’s “Nigerian Global”: (2002) Our Failed Attempts

Once again, undaunted and with Ulysesian determination, the then Minister, Kema, as fondly called, shrugged off the setbacks of a failed “Air Nigeria”, and set out for her next floatation; her second attempt which she called “Nigerian Global”.  This contraption as it came to be, was to have a foreign core investor that would hold 49% equity while Nigerian Institutional and Private investors would hold 51%.

The Minister announced the technical partner and core investor as Triaton A.G. ostensibly of Switzerland.  She also said that Airbus Industries had indicated interest in the new venture. At this point, the BPE and the National Council on Privatization had been shoved aside with the explicit approval of the President.  And Chikwe had been advised that unless Nigeria Airways was liquidated, it would be impossible to float another national carrier.

This was the sole reason for the unyielding quest to liquidate Nigeria Airways.  Between 2002 when her “Air Nigeria” project was shot down, and the Hand-over date in May 2003, there was little or no time to professionally and diligently carry out any floatation of an airline.  But the urge, inexplicable as it was, was irrepressible.  And so the Minister, relentlessly put everything in the works side by side to liquidate Nigeria Airways and to float her new baby – the “Nigerian Global”. 

The Minister was so much in a hurry to make the airline fly before the handing over date.  And so, even before the elections were concluded, Kema had announced to Nigeria that her incubated airline would soon commence operations.  As at this time, no airline company had been incorporated, neither was there an application to the Nigerian Civil Aviation Authority for an Air Transport License – ATL, let alone an Air Operating Certificate – AOC both of which are irreducible documents for any airline operation.

This was granted since there was nothing odd.  It is not even clear that 99.6% of NCAA officials knew what was coming as everything was wrapped in a cloak of clandestinity.In spite of these, in early May 2003, the Minister leased a 20-year old Airbus, put a sticker on it with a “Nigerian Global” logo, sought an approval from NCAA for a technical landing.

Then, just one fateful day, the Minister gathered the media at Murtala Mohammed International Airport to welcome Nigeria’s new National Carrier, the “Nigerian Global”.

  The rickety aircraft flew in as programmed and left after the media hype.  The next day, the media was awash with the title “Enter Nigerian Global”.

Convinced that this was a fait accompli, Chikwe proceeded with the memo seeking approval for the establishment of her “Nigerian Global”.  This was at the FEC valedictory meeting of Obasanjo’s first tenure in 2003.  This request was “shot dead” by a combination of Adamu Ciroma, T. Y. Danjuma and Abubakar Atiku and buried by NLC and Aviation Unions team led by Oshiomole and Nnorom respectively.

The team met with OBJ and Kema at the Villa immediately after the FEC meeting during which they put a final nail on the coffin of the airline.  And so, Nigeria’s supposedly new fifth “National Carrier”, “Nigerian Global”, a deception grandeur, as it were, like a home video movie, never saw the world of aviation.

Yuguda’s “Nigerian Eagle”: (2003) Our Failed Attempts

Having won the election in 2003 and returned as President, Obasanjo appointed Isa Yuguda, Minister of Aviation with the mandate to float a replacement national carrier for Nigeria Airways.  Yuguda set out by appointing one of Nigeria’s most seasoned financial experts – Bismark Rewane the CEO of Financial Derivatives as the Financial Advisor for the new floatation.  Yuguda’s new airline was to be called “Nigeria Eagle Airline”.  Neither Yuguda nor Bismark had any exposure in airline floatation which is normal.

What was needed was to appoint an acquitted Consultant in airline matters, just as Joji and IFC did.  The Minister should have seen that IFC, in spite of its global exposure, found it imperative to appoint, along with Legal and Finance Consultants, seasoned Technical Consultants in Aviation, which included Nathan Associates, Ashurst Aviation and A.W Consultants Limited when it was working on the floatation of “New Co”.

Yuguda proceeded to advertise for bid for a Technical Partner cum Core Investor.  At the end of it, only South African Airways bidded.  We warned the Minister to be wary about South African Airways for many reasons, contending that the Airline did not possess the competence and reliability for managing an airline let alone for the floatation of a new airline.  The reasons were so many, including the few below.

As at 2003/4, three years earlier, in 2001, the 5-man US Airways team led by Coleman Andrews hired in 1998 as CEO/President to turnaround post-apartheid South African Airways had left in 2001 and a new indigenous Management led by Andre Vijoen was appointed.  The Management was then green and trying to find its feet.

Secondly, the inexperience of that Management showed in one of the worst airline acquisitions of that period when in 2002, it took a 49% stake worth US$20million in Air Tanzania, an airline that was reputed to be the worst in Eastern and Southern Africa.  Its debt profile was high; it had no virile indigenous air passenger market to support its international operations to Dubai and London.

At the domestic level, only Dar-es-Salaam, Arusha and Zanzibar provided reasonable traffic that could support 75-seater aircraft while Dodoma and Mwanza did not offer much.  No wonder why South African Airways, in its published proposed routes then for Nigerian Eagle, a major one was Lagos-Dar-es-saalam; two cities that had no viable trade attractions.  The objective was to feed Air Tanzania with Nigerian traffic to Middle and Far East via Dar-e-salaam. Again, operationally, the airline’s performance was abysmal.

Tanzania referred to it as “Air UDA”, a derogatory reference to the city bus service – Usafiri Dar-es-Salaam – UDA, which was always late and was named Úchelewa Saajji Dar-es-Salaam – UDA, that is, “the late-comer of Dar-es-Salaam”.  On reliability question, Yuguda forgot or did not care about how South African Airways, in 2002, repudiated its Joint Venture operations with Nigeria Airways between Lagos and New York without any information to Nigeria Airways, thus leaving hundreds of Nigeria Airways passengers stranded;

an action that  brought out the finest elements and patriotic zeal in the then Minister, Kema Chikwe who, against the usual two months processing period, under 48hours, used her strong contact with Rodney Slarter, then US Transport Secretary, to secure clearance for Nigeria Airways to fly its own aircraft on the Lagos-New York route.  Yuguda was not deterred by all these question marks as he continued.

In 2004, Viljoen was forced to resign following a currency hedging failure that cost the airline a loss of 6billionRand about US$500million as at today’s rate.  For us who warned the Minister, it was “Quod Erat Demonstrandum”. Khaya Ngqula replaced Viljeon as CEO with Prof. Jakes Gerivel as Chairman.

Before this time, Yuguda did not know that his boss, OBJ, had his own agenda.  Yuguda had no inkling until the day a British Airways team from UK went in the company of the Minister to pay a courtesy call on the President.  In the course of discussion, the BA team promised to assist the Minister in the new national carrier, Eagle Airline, he was floating.

In his typical below-the-belt punch, OBJ startled everybody present when he retorted, “which airline”?  Mr. Minister, I don’t think what you are doing will work.

Thus, ended Yuguda’s South African Airways adventure; the failure and closure of the sixth attempt at floating a replacement national carrier for the ill-fated Nigeria Airways.You better talk to this people (BA)”.  Weeks later, the President gleefully, on NTA network news, presented a miniature prototype of an aircraft with the logo of “Virgin Nigeria” – the new national carrier conceived by Richard Branson, CEO of the Virgin Group, who stood side-by-side with the President at the Villa.

OBJ/Branson’s Virgin Nigeria: (2004) – Our Failed Attempts

Conceived by President Obasanjo and the CEO of the Virgin Group, Richard Branson in 2004, Virgin Nigeria was the 7th attempt to float a replacement national carrier for the liquidated Nigeria Airways.  After the theatrical Villa presentation of the miniature aircraft bearing the insigma of Virgin Nigeria by OBJ and Branson, the Memorandum of Mutual Understanding (MOMU) was signed and the concept formally came into being September, 2004.

However, it was not until July 2005 that the airline commenced operations.  To facilitate the operation of Virgin Nigeria, the government agreed to terms that stunned all discerning Nigerian aviation professionals and even the global aviation industry.

Under the terms, the Virgin Group led by Branson was given a free hand to design and determine the structure of the airline even when its equity was to be 49% against Nigeria’s 51%.  The Group had the right to lease all aircraft, manage the airline, determine the roadmap, the routes and its focus.

Also Branson’s Virgin Nigeria was given the right to all Nigeria’s 64 BASA then and first option of choice on any new BASA.  In addition, Virgin Nigeria would operate all its domestic flights from the international terminal of MMA where the “E” Wing was redesigned for Virgin Nigeria.  The objective was to facilitate easy transfer of Virgin Nigeria passengers booked for international flights onto Virgin Atlantic; the Group’s flagship in which Nigeria had no interest.

Although, the then Aviation Minister – Isa Yuguda, had taken responsibility and had dragged Rewane of Financial Derivatives as Financial Advisor into it, all the planning processes were entirely the affair of Branson and his Virgin Group.

There was no Board, the entire Management was drawn from the Virgin Group, emoluments were fixed by the Group and the only Nigerian brought into the Management on a façade was Larry Agose, one of the best Public Relations Professionals that ran Nigeria Breweries public relations.  But until then, he had no exposure in aviation.

It is also true that UBA was both the Airline’s Banker and a Co-investor; the bank had no scintilla of knowledge on airline matters and therefore had no input in the direction of the airline.  The Ohiwere-led Board was a development that came after all major decisions had been taken for commencement of operations.

The entire industry from AON, groups and individual professionals protested the embarrassing anti-patriotic terms given to Branson to no avail.  Even letters written to the President received very non-positive responses.  One such response which came from Profession Ahionbare, Special Assistant to the President, stated inter alia, “I assure you we will do what is in the best interest of Nigeria.”

An aviation activist, Capt Jerry Agbeyegbe went to court, seeking to stop Virgin Nigeria, but four days to the case coming up, Agbeyegbe was murdered in cold blood, a murder that remains, unexplained and unsung till date.  In spite of all these, the airline commenced operations July 2005 around its strategic plan to be a feeder/distributor of passengers to Virgin Atlantic as well as an instrument to combat British Airways dominance in Nigeria.

The airline built one of the best infrastructures for airline operations and easily achieved dominance on the domestic and West Coast routes where it was easily the first choice airline. But in keeping with its roadmap, in spite of the government’s pressures to operate international routes which it had no intentions to do, the Virgin Group though, started flights to London, Dubai and Johannesburg, it ensured that these routes were shoddily operated with a rickety B767 as against the modern A330 it was using for Virgin Atlantic.

Again, in the case of London, it transferred Virgin Nigeria flights from Heathrow to Gatwick which was second rate to Heathrow. Thus, the Virgin Group deliberately created conditions for poor patronage, poor revenue and operational losses, all of which it used as alibi to pull out from all the routes pleading loss-making.   It is informative to recall that Virgin America floated by Branson made a loss of US$250million between 2007 and 2009 in its first 2 years, yet it continued and now thrives.

Right from the first year of operation, Virgin Nigeria went into heavy borrowing from its bankers – UBA.  This was predicted as the start-up fund, was paltry and was irresponsibly used by the Virgin Group managers of the airline. Between December 2005 and March 2006, UBA approved a four-month bridging loan of US$20miilion as working capital, financing and aircraft guarantee.

This was followed with another US$40million in 2006 and yet another US$100million zero coupon bond issue.  There is also the US$100million facility from Cairo-based AFREXIM Bank, obtained by UBA ostensibly on behalf of the airline.  When the burden of debt became excessive to UBA, the Virgin Group managers sought a facility of US$15miilion from GTB in a manner that was so unethical and unbecoming of a Group whose global perception is that of a bench-marker.

As at the time that the Virgin Group sought the facility, all the assets of Virgin Nigeria were encumbered in an unperfected “All Asset Debenture” instrument held by its bankers – UBA as security for the US$200million loans it granted the airline.  The Virgin Group managers of the airline, not only concealed this fact from GTB, but presented some of the same encumbered assets to the bank as collateral for the US$15million facility.

Immediately the facility was granted, UBA perfected the “All Asset Debenture”, which included uncalled capital, thus rendering GTB’s US$15million absolutely unsecured.  This criminal act of deliberate concealment, never experienced before in the banking history, and perpetrated by an otherwise perceptively reputable foreign investor-group, left GTB no option than to head to the court to force payment.

The US$15million is today part of the unsecured N35billion debt stock of Virgin Nigeria held by AMCON, which Nigerian tax payers have to liquidate. However, more contributory to the indebtedness and eventual failure of Virgin Nigeria were the lease terms of the aircraft the Virgin Group acquired for the airline’s operation, particularly the seven Boeing 737s.  From records available, the lease terms were inexplicably at variance with all known global standards and even the Virgin Groups standard.

Against global standards of 3 years lease tenure, Virgin Nigeria leased for 5 years.  Against global standard of monthly lease term of 120 block hours, Virgin Nigeria’s was 200 block hours even when actual utilization was between 100 and 130 block hours monthly.  Yet, the unutilized hours ranging between 70 and 100 block hours were paid for even when the aircraft were out of service due technical (AOG).

Further investigations showed that as against the standard monthly lease rate of US$125,000, the Virgin Group managers paid US$181,000 in addition to US$151,000 monthly maintenance reserve, bringing the total monthly expenditure for each of the seven B737s to US$332,000.  Thus, annual payment for each aircraft came to US$3,984,000 and US$19,920,000 for 5 years tenure per aircraft and US$139,440,000 for the seven B737s for the 5-year tenure.

UBA Capital had planned an IPO, which it projected would fetch them US$450million but the then Board led by Mr. Ohiwere saw through the “hidden agenda” in the plan, headed to court and botched the IPO.  The Virgin Nigeria got its bankers to arrange a 2-year convertible bond of US$100,000.Industry projection is that Nigeria lost over US$60million to this murky lease arrangement; an amount that became part of the N35billion debt of the airline. By 2007/2008, the Virgin Group had started complaining of its “loss-making” Nigerian venture.  Consequently, it took a decision to exit having seen the imminent collapse of the airline it ran.

Once the sum was available, UBA took US$20million upfront as interest and charges, the Virgin Group took US$35million (US$24m+US$11m, ostensibly to cover respectively its equity contribution for its 49% stake in the airline and for brand royalty fee for Virgin Nigeria’s use of its brand).  The Group claimed it was for lease rental payment.

Once Virgin Group took this money, having more than recovered its investment, it withdrew from Virgin Nigeria, recalled the entire Management, all of whom were the Group’s staff (CEO, Conrad Clifford on June 18, 2009 and others on July 4, 2009) and demanded, under a threat of litigation that its brand be immediately taken off from the airline.  This exit left the entire burden of the airline on UBA which provided all the funding with the exception of the US$15million from GTB.

The irrefragable fact is that, no matter the Virgin Group pretences, they ran the airline aground; collapsed it and left unscathed.  Thus, Virgin Nigeria, which the then President, OBJ, presented to Nigerians as in the best interest of our nation; an airline which the CEO, Conrad Clifford told the National Assembly in 2008 that by 2010, would acquire 40 aircraft and employ 6000 Nigerians collapsed, leaving an operational debt of N35.5billion in three years;

an operational debt profile which Nigeria Airways did not incur in the last 10years (1992-2002) to its unfortunate liquidation.  Worst still, the Virgin Group left without adding any value to the industry, no trained manpower, no assets; aircraft or structures. The airline left us with so many lessons;

it was a victim of low capitalization, well masterminded immediate returns to the Virgin Group, incredible faulty financial engineering based on quick gain aspirations, internal stakeholder-wrangling and distrust, continuous non-application of due diligence in all deals, deception bothering on fraud, high profile impunity and opacity as well as utter disregard for indigenous professional patriotic advice.

In all, it is a classic lesson of how not to hand over our patrimony, without a national oversight, to a foreign investor whose ulterior interest is not known. In fact, Virgin Nigeria was not a national carrier by its equity structure, as claimed by its owners but a private Nigerian flag carrier put together by a two-some with a foreign investor and a façade of involvement of some selected few. It was an appropriation of our common wealth, simpliciter.

Nigerian Eagle  – Capt. Olumide’s Rescue Airline (2009): Our Failed Attempts

When the Virgin Group left, it left a debt burden of US$250million, had placed an order of 10 Embraer models 170 and 190 worth US$450million and with an option of additional 6; all these when it had a negative capital and zero cashflow and one of its B737 that went for a C-Check was grounded in Europe for the airline’s inability to pay US$1.4million for the checks.  For the first two Embraers billed for delivery in November 2008 and June 2009, UBA had to pay the needed deposit of US$25million as well as cover the 60% balance on the 190 model on delivery.

When Branson ordered and effected a pull out, the AOC of Virgin Nigeria was to be withdrawn by NCAA but for the spirited effort of the then Chief Operating Officer (COO) of the beleaguered airline, Capt Dapo Olumide, who quickly engaged Ethiopian Airline as technical partner.  Olumide was eventually appointed Managing Director by UBA which, having inherited the airline’s total liabilities, literally owned the airline.As at this time, Virgin Nigeria had not only become a burden to UBA, but a toxic asset.  UBA’s “All-Asset-Debenture” was hollow as the debt-ridden and mismanaged airline had no asset since all its aircraft were on lease.  The order of 10 Embraer was a smart move to create an asset base on which the Debenture would sit.

As at this time, Virgin’s liabilities had been transferred to UBA Capital to save the bank from the Lamido Sanusi gale blowing through the banks as the entire Virgin debt was unsecured. With an uncanny professional expertise and palpable commitment, Olumide engaged the challenges of the badly managed airline.  He was determined to make a change; albeit, to leave a legacy.

Unfortunately, Olumide who neither understand nor has patience for intrigues, did not know that he was floating on a dense sea of intrigues whose outer layer was only a façade of normalcy. On transition from Chief Operating Officer to CEO, Olumide engaged a Nigerian Consultant to renegotiate the monthly block-hour lease rental of the five operational 737s and succeeded to reduce it from US$181,000 to US$125,000.  He restructured the routes, re-jigged service delivery and installed financial prudence.

Olumide further negotiated the price of the Embraer from US$30million down to US$28million.   To enable him drive the turnaround of the airline to a great end, sought a facility of US$70million from UBA without success.  He had also tried to no avail to register the airlines new name of “Nigerian Eagle”. As at this time, Jimoh Ibrahim who was the Chairman of Corporate Affairs Commission, was already in discussion with UBA to buy over the airline.

His choice name for the airline was “Air Nigeria” which he was already working on without Olumide’s knowledge.  The truth is that, as at the time the Virgin Group exited, UBA was no longer comfortable with their investment in the airline.  All the bank wanted was to sell off the toxic asset.

Jimoh Ibrahim and his faceless colleagues were willing buyers.  Olumide, who was driving the turnaround of the beleaguered airline with immense passion, only woke up one fateful day to hear that Jimoh Ibrahim had bought over the airline.  It was then that Olumide realized that he was a mere transitory manager, ill-used and “abused” as it were, by an insincere owner/employer who had little or no regard for his effort, commitment and success.

He picked up his bag and walked away.  Thus, ended the 8th attempt to have a virile national carrier in replacement of liquidated Nigeria Airways.

 Jimoh Ibrahim’s “Air Nigeria” (2010) Our Failed Attempts

From behind the scene, Jimoh Ibrahim emerged as the new owner of erstwhile Virgin Nigeria (Nigerian Eagle).  On taking possession, Jimoh Ibrahim correctly noted in his first public statement that the finances of the airline were parlous and that its turnaround would require huge financial outlay.

He then affirmed his vast experience in “swimming in troubled waters”, more so as he had injected US$5million into the airline.  He had also not only paid off all Virgin Nigeria’s debt worth N35billion and secured the US$70million facility from UBA, which the bank denied Olumide.

However, in my article published in Tell Magazine in 2010, I pointed out that “my first worry is that he financial waters of Virgin Nigeria are not just troubled, but are, like polluted waters of the Niger Delta creeks, brackish and dense, with undergrowths of badly finished, unfinished, maturing and yet to mature deals of immense financial relevance.

Hanging over the waters, like entangling mangrove shrubs, are standing arrangements on leases, insurance and orders …  All these not only impede vision, but also make swimming extremely difficult and slow even for the swiftest swimmer of troubled waters”. Having lost the airline best turnaround manager, Capt Olumide, Jimoh now elevated the airline Chief Technical Officer, Kinfe, the Ethiopian who worked under Olumide to the position of Managing Director.

This position was however titular as Jimoh was the defacto Chief Executive.  This was the beginning of the end as it brought in its wake, two major collapse factors of many airlines in the country:  Owner-Manager syndrome and Executive arrogance.  Very early in his take-over, many experienced senior personnel; Directors; Pilots and Engineers left after quarrels and disagreement over management model.

Coupled with these, was the fact that Jimoh, sadly, had no reasonable knowledge of airline management.  His only foray into it was his acquisition and collapse of EAS Airline, having re-branded it NICON AIRWAYS. The result was that the fortunes of the airline nose-dived meteorically in just under one year from the height Olumide had taken it to.

Few months later, Air Nigeria office became a battlefield between in-house unions and the owner/manager over unpaid salaries and allowances, maintenance issues and diversion of revenue and facilities meant for the airline to other businesses.  Eventually, the airline staff went on long strike that crippled operation and led to their sack.

Before this stage, Jimoh Ibrahim had announced that he had paid off the entire debt of the airline worth N35billion to its banker – UBA.  And indeed, UBA issued him a debt-free Certificate, a copy of which he tendered at the National Aviation Joint Committee Public Hearing on DANA crash.

This payment was ostensibly made before the CBN N300billion Intervention Fund, part of which was created to help the banks liquidate their exposure to airlines.  When this happened, Air Nigeria and UBA immediately resurrected and re-established the N35billion debt in the Bank’s books on the basis of which it applied and secured, on behalf of Air Nigeria, N35billion from the Intervention Fund.

How this money was deployed became the grouse of the staff who alleged that, instead of using it to enhance the airline’s operations, it was diverted to establish banks and other businesses in the West Coast.  An allegation Jimoh Ibrahim denied.

The naked fact is that no further investment was made in Air Nigeria.  The few “loyal” staff that were left were hanging on with great trepidation even after the former President; Olusegun Obasanjo went to NICON Group Headquarters to address them with assurance of revival.

OBJ’s address created new problem as Nigerians questioned his involvement; was it out of milk of human kindness which normally does not flow in OBJ’s psyche or was it empathy for the plight of the staff or a kind of guilt?  Or, may be, Air Nigeria was the last of his triplets; the others being Virgin Nigeria and Nigerian Eagle, both of which have died?

Finally, as predicted, Jimoh Ibrahim’s Air Nigeria not only collapsed but its N35billion debt burden has been passed to Nigerian tax payers through AMCON.  AMCON willingly and without questions, acquired an unsecured debt that, from all intents and purposes, was premeditatedly syndicated to end in its hands.  The small assets of the airline which included two brand new Embraer 170 and 190 as well as others have even been left to rot by the Asset Manager.

“Nigeria One” – Oduah’s Unborn Baby: (2012) Our Failed AttemptsNo doubt, the trio of Virgin Nigeria – Nigerian Eagle – Air Nigeria like “Abiku”, all died but they left us immense lessons and will remain the saddest and most retrograde segment in the annals of our aviation history.

Stella Oduah was appointed Minister of Aviation in the third quarter of 2011 under Jonathan’s first full term Presidency.  She was completely unknown in the aviation sector; a neophyte.  On assumption of office, she did not waste time before she stamped her name in the industry.

With her aviation roadmap, she established an image of a focused person.  Within 15 months, like a blitzkrieg, she stunned the industry with her re-modeling and up-gradation of 22 airports.  Oduah’s success elicited so much applause that she easily became the “poster minister” of Jonathan’s administration.  So, when she announced her intention of floating a National Carrier, only a few antagonists doubted her and wished her ill-luck.

Again like some of her past colleagues, she had no iota of knowledge in airline floatation and also, like them, the steely and self-confident Minister did not think she needed the assistance of those who know.  It is true that she assembled a team of industry professionals, but ninety percent of them were acquitted professionals in other areas of aviation rather than in airline sub-sector.  Their inputs were neither original nor grounded, but from secondary and tertiary sources.

To alleviate this inadequacy, Oduah ran from one part of the globe to the other and from one aircraft manufacturer to the other canvassing and selling her ideas without success. Everywhere she went, the attendant lack of professionalism was noticed and this attracted unsavory comments from both domestic and global aviation environments.  But she apparently did not know.

As happened with other attempts before Oduah, there were very stiff oppositions: some genuine, some from uninformed fixations and others self-serving from “dog-in-the-manger” operators. As opposition and mischief thickened, the Minister opted for a guerilla warfare approach, called the “Tunnel Strategy”.  She thus gathered her not-too-informed team into the “tunnel”, thus closing every avenue of information on her floatation plans.  Unfortunately, this worsened the situation as rumours took over the air above Oduah’s “Tunnel”.

Today, she would be accused of plans to use Hak Air as National Carrier, another day it was Aero that would transfigure into her “Nigerian One”. Worst still, the Minister went into the “Tunnel” without the fundamentals; she did not create an exit point, secondly, she did not post a sentinel above the “Tunnel” to constantly inform her about the goings on, and critically, those who go into tunnels in guerilla warfare situation are usually hard-baked, and tested professionals, but Oduah’s team was not so endowed.

The result was that the soft-and-little-spoken Minister stayed too long in the “Tunnel” and exposed her “National Carrier-Baby” to gestational impediments, feotal suffocation, atrophy and death.  By the time she emerged from the “Tunnel”, she had lost focus, floundered and had no airline to offer Nigerians.  Thus, ended the 10th attempt to float a National Carrier.

In spite of all these, a National Carrier is as possible and feasible as it is imperative to avoid an impending devastating disaster that will wipe out Nigeria in the continental and global airline industry.  What is needed are strong political will, the kind that Margaret Thatcher of UK and Arap Moi of Kenya demonstrated to give their nations befitting National Carriers, honesty of purpose, national interest and use of relevant indigenous professionals to guide and supervise a new floatation with absolute transparency.

And I am convinced that we are lucky to have a President and a Vice that are imbued with above virtues. To kick start this process, a very strong 15-20-man Committee should be set up with the Ministry as a Secretariat only.  The Committee should report to the President through his Vice.

VANGUARD

 

END

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