Arik Air’s N120bn Debt Proposal Emerges in Court as Kuru Trial Continues

By Ranti Thomas

Letters from Arik Air’s former chairman, Sir Johnson Arumemi-Ikhide, proposing a settlement of the airline’s debts to the Asset Management Corporation of Nigeria (AMCON) have come into focus during the ongoing trial of former AMCON Managing Director Ahmed Kuru and four other defendants in Lagos.

The correspondence was raised during the cross-examination of the Economic and Financial Crimes Commission’s fourth prosecution witness, Bawa Usman Kaltungo, by Olasupo Shasore, a Senior Advocate of Nigeria (SAN), who represents Kuru.

The proceedings took place before Justice Mojisola Dada at the Lagos State High Court, Special Offences Court, in Ikeja, as the defence continued to challenge aspects of the EFCC investigation into AMCON’s intervention in Arik Air and the establishment of NG Eagle.

During the questioning, Shasore asked Kaltungo whether the EFCC had interviewed Arumemi-Ikhide, the chairman and promoter of Arik Air, to obtain information about the airline’s financial dealings with AMCON.

The witness said he had discretion over the persons invited for questioning during an investigation.

Shasore then drew attention to documents showing that Arumemi-Ikhide had communicated with AMCON over the airline’s financial obligations, including a letter dated January 25, 2016, addressed to Kuru.

The letter, titled “Proposal for Resolution of Arik Air Limited’s Facilities Acquired by AMCON,” outlined a proposed arrangement for settling the airline’s obligations following AMCON’s acquisition of certain credit facilities from Union Bank of Nigeria and Keystone Bank.

In the correspondence, Arumemi-Ikhide referred to discussions with AMCON concerning the facilities and other financial support associated with the airline’s operations.

The letter estimated that Arik Air’s total outstanding obligations could reach about N120 billion by the end of January 2016, including interest and after taking account of payments made up to that time.

As part of the proposed settlement, the airline’s chairman requested a 35 per cent discount, which would bring the amount payable down to N78 billion.

The proposal also outlined a payment plan involving an initial N10 billion payment, funds to be raised through a private placement, a future public offer and monthly payments of N200 million from the airline’s collections.

The proposal was presented as a basis for reaching an agreement with AMCON. The letter itself does not establish that the corporation accepted all the proposed terms or that the repayment plan was fully implemented.

Another document highlighted during the proceedings was a letter dated October 9, 2017, titled “Repayment of Arik Air Limited’s Debt to AMCON and Other Creditors.”

In that letter, Arumemi-Ikhide expressed the airline’s willingness to work with AMCON and its receiver manager towards resolving the financial dispute. He also thanked the corporation for keeping the airline operational and referred to efforts involving shareholders and prospective investors to support negotiations.

The correspondence was addressed to the AMCON managing director, with attention to Kuru, and copied to the airline’s receiver manager and Captain Roy Ilegbodu.

The defence relied on the two letters to challenge the picture presented by the EFCC witness concerning Arik Air’s indebtedness and AMCON’s intervention. The documents show that the airline’s chairman engaged with the corporation over the debt, although the legal implications of those engagements remain matters for the court to consider.

The cross-examination also focused on the allegation that Kuru transferred N4.9 billion towards the establishment of NG Eagle.

When Shasore asked Kaltungo to identify documentary evidence supporting the allegation, the witness said the information came from Arik Air’s Chief Financial Officer, Jonathan Sani, who allegedly provided a breakdown of the amount.

The defence counsel then asked the witness to identify the supporting information in Exhibit P23, part of the prosecution’s evidence. According to the account of the proceedings, Kaltungo could not immediately locate the material containing the breakdown.

Shasore also presented a certified true copy of an extract from AMCON’s 78th board meeting, which the defence said contained approval for the establishment of NG Eagle and the budgeted expenditure for the process.

The defence argued that the document was relevant because it indicated that the decision to establish NG Eagle involved the AMCON board and was not solely Kuru’s decision.

Kaltungo, however, urged the court to disregard the board extract tendered by the defence, leading to further disagreement over the significance of the document and the role of the board in the transaction.

The witness also alleged that Union Bank had misled AMCON into acquiring Arik Air’s debt. He maintained that the EFCC investigation had not established that Union Bank granted the loan in question and argued that the loan was performing.

Kaltungo further expressed the view that AMCON lacked the authority to take over Arik Air’s debt, describing the intervention as illegal and fraudulent. Those statements formed part of his testimony and have not, by themselves, been established as findings of the court.

The defence’s questioning centred on whether the investigation adequately considered the correspondence between Arik Air and AMCON, the airline’s proposed debt settlement and the board’s role in approving NG Eagle.

Kuru is standing trial alongside Kamilu Omokide, a former receiver manager of Arik Air Limited; Captain Roy Ilegbodu, the airline’s chief executive officer; Union Bank Limited; and Super Bravo Limited over allegations connected to Arik Air, NG Eagle and related financial transactions.

The case followed a petition by Femi Falana, SAN, on behalf of Arik Air’s promoters and shareholders. The allegations against the defendants remain before the court, and the evidence presented during cross-examination will be considered alongside the prosecution’s case and the defence’s response.

Justice Mojisola Dada adjourned the proceedings until December 3 and December 10, 2026, for the continuation of the trial.

The next hearings are expected to provide further opportunity for the parties to address the issues surrounding Arik Air’s debt, AMCON’s intervention and the establishment of NG Eagle.