TheCable

The Export Development Canada (EDC) has asked the Economic Financial and Crime Commission (EFCC) to stop interference in the sales of its mortgaged aircraft by JEM Leasing, the owner. 

EDC is a crown corporation, wholly owned by the government of Canada. 

The aircraft, CRJ 1000, is a twin-engined regional airliner with a capacity of 100 passengers.

Earlier in the month, Arik Air had said it removed the CRJ 1000 aircraft from its fleet, due to the decision of JEM Leasing Limited, the owners of the CRJ 1000, and its financiers to sell the aircraft.

Following a petition filed by Johnson Arumemi, founder of Arik Air, the EFCC is said to be working to lay off EDC’s mortgage rights. 

A legal mortgagee has a right or remedy to enter upon and take possession of the mortgaged property until the amount of the loan with interest is recovered. 

In a letter addressed to the commission, and seen by TheCable, EDC said it financed, in part, Jem Leasing’s acquisition of the aircraft; and became the mortgagee as a condition to the financing.

“The aircraft remains mortgaged to EDC. We confirm the veracity of the statements set out in the owner’s letter, including that the owner has entered into an agreement with Alberta Aviation Capital Corp (the buyer) to sell the aircraft to the buyer,” EDC said. 

EDC said the agreement was entered into with its consent and at its request. 

“We understand that the EFCC may have taken certain steps that prevent the buyer from having access to the aircraft,” EDC said. 

EDC said it also understands that “certain press reports allege that the owner has dissociated itself from the sale of the aircraft to the buyer and the plan to tear down the aircraft, and called for an investigation into his asset destruction and the claims of Arik Air in relation to the aircraft”.  

The Canadian corporation said the allegations are untrue, stating that the owner has “confirmed that it has agreed to sell the aircraft to the buyer, that the buyer is authorised to tear down the aircraft, and that Arik Air has no interest in the aircraft”.

“As stated in the owner’s letter, any interference action by Arik, or any other person, which impedes the buyer’s access to the aircraft, or any of the other steps, matters, processes or transactions, will constitute improper interference with the owner’s (and/or the buyer’s) rights in respect of the aircraft,” EDC said. 

“Any such interference would also constitute improper interference with EDC’s rights as mortgagee of the aircraft.

“We, therefore, respectfully request that the EFCC does not impede the buyer’s access to the aircraft or any of the other steps, matters, processes or transactions outlined in 2(g) and 2(h) of the owner’s letter.”

Speaking on the issue, aviation observers called on the Nigerian government to protect the interests of international lenders, such as EDC, and other potential lenders closely monitoring the ongoing investigations by “EFCC into the affairs of the receiver manager of Arik, as it relates to the enforcement of mortgage rights by EDC, in respect of a CRJ 1000 aircraft owned by JEM Leasing”. 

In February 2017, Arik Air was taken over by the federal government via the Asset Management Corporation of Nigeria (AMCON) due to the company’s huge debt profile, which was over N300 billion.

The government immediately dissolved the airline’s management team, and appointed a receiver-manager.