September 11, 2017 / 5:00 PM / a year ago

Nigeria's bad bank not talking to Ethiopian Airlines over Arik

LAGOS, Sept 11 (Reuters) - A receiver appointed to rescue Arik Air, Nigeria’s largest airline, is holding talks with creditors and is not negotiating a sale to Ethiopian Airlines, the country’s “bad bank” said.

Arik Air shareholders have filed a court case against Nigeria’s government and Ethiopian Airlines in an attempt to halt any talk over the sale of the airline, which controlled around 55 percent of the domestic market.

The airline had been hard hit by a currency crisis in Nigeria as its customers are invoiced in naira but its fuel suppliers are paid in dollars..

The shareholders are also challenging the takeover of the airline by the bad bank, the Asset Management Corporation of Nigeria (AMCON), in court.

Jude Nwauzor, AMCON spokesman said on Monday the “bad bank” was not in negotiation with Ethiopian Airlines and would want to resolve all court cases in addition to receiving the report of the receiver manager before taking any action.

AMCON took over the day-to-day running of Arik Air in February in an attempt to rescue the airline after it was unable to pay workers or creditors.

“They have not completed their assignment ... they are still having meetings with some creditors,” Nwauzor said, adding that the airline has improved, with some creditors now willing to do business with it and staff being paid.

It has said Arik owed around 147 billion naira and another 165 billion naira to four commercial lenders, while its founder Michael Arumemi-Ikhide owed AMCON 263.7 billion naira.

Arumemi-Ikhide was not available for comment, while Arik Air declined to comment.

Nwauzor said it was too early to comment on a timeline for AMCON to recover its debt due to its size. (Editing by)

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