. Ethiopian airlines

*MRS, SAHCO, NSF to manage 46% stake

By Prince Okafor

The Federal Government has announced Ethiopian Airlines, as its major partner for the Nigeria Air project.

A breakdown of stakes showed that Ethiopian Airlines will own 49 per cent equity, the federal government will control five per cent equity, while a consortium of three Nigerian investors MRS, SAHCO and the Nigerian Sovereign Fund, will have 46 per cent.

Speaking during a press conference in Abuja, the Minister of Aviation, Hadi Sirika, noted that after a careful, detailed and ICRC-governed selection process, Ethiopian Airlines (ET) Consortium has been selected as the preferred bidder, offering an owner consortium of 3 Nigerian investors MRS, SAHCO and the Nigerian Sovereign Fund 46 per cent, FGN owning 5 per cent and ET 49 per cent.

He noted that the consortium has been subjected to a due diligence process, after which the contract will be negotiated between the consortium and the FGN, leading to a Full Business Case, which will be expected to be approved Federal Executive Council (FEC).

The process according to the minister will take off in six to eight weeks.

“The overall share capital of around US$300m, will be provided by the preferred bidder that will launch Nigeria Air to its full size of 30 aircraft and international operation within the next two years.

“Nigeria Air will be launched with three Boeing 737-800 in a configuration very suitable for the Nigerian market and will launch with a shuttle service between Abuja and Lagos to establish a new comfortable, reliable and affordable travel between these two major Nigerian Airports. Other domestic destinations will follow thereafter.

“A signature-ready contract has been finalized with Ethiopian Airlines for the three Boeing 737-800 with a 16 Business Class and 150 Economy Class configuration.

“All Executives have been approved by NCAA, the Air Transport License has been issued by NCAA, Nigeria Air (after having identified the first three aircraft) will now finalize all necessary Operation Manuals and then go through the inspection and approval process of NCAA.

“The money spent for the launch of Nigeria Air, for all the requirements to establish an AOC and be admitted starting an airline operation, is well within the 5 per cent capital investment of the Federal Government of Nigeria, that will be overall needed to establish the National Carrier initially for the AOC approval and everything else required by stringent national aviation regulations, as prescribed in the FEC approved Outline Business Case (OBC).

“This OBC is the milestone for the preferred Bidder Consortium and has been met by the submitted business plan of the preferred bidder. It is the overall share capital of around US$300, provided by the preferred bidder that will launch Nigeria Air to its full size of 30 aircraft and international operation within the next two years.

“No further federal government funding will be provided above the five per cent share capital of the next national Carrier of Nigeria, which was provided to launch Nigeria Air,” the minister added.

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