Private investors to raise USD 250m for formation of new national carrier
At least a total sum of USD 250 million would be raised by private investors to start a new national carrier for Nigeria, Sen. Hadi Sirika, the Minister of Aviation has said.
The minister also said that the Federal Government’s investment in the new national carrier would not exceed 5 per cent.
These were contained in a document detailing the status of Aviation Road Map made available to aviation journalists by Dr. James Odaudu, the Director, Publicity, Ministry of Aviation.
Sirika stated that the project development phase has been completed with the development of the Outline Business Case (OBC) and subsequent issuance compliance certificate by the Infrastructure Concession Regulatory Commission (ICRC).
According to him, the next phase of the exercise would involve the commencement of procurement, which is placement of Request for Qualification (RFQ) in local and international media.
Sirika insisted that the establishment of a national carrier would enable Nigeria to gain from Single African Air Transport Market (SAATM), which the country is a signatory to.
He added: “The establishment of a national carrier will enable Nigeria gain optimal benefits from Bilateral Air Services Agreement (BASA) arrangements, take full advantage if the Single African Air Transport Market (SAATM), introduce competition, leading to competitive fares and better services as well generate employments.
“The national carrier project will be private sector driven with government not holding more than 5 per cent shares.
“The private sector consortium may comprise reputable international airlines such as Quantas, leasing companies, aircraft manufacturers, Original Equipment Manufacturers (OEMs), financial and institutional investors.”
Sirika emphasised in the document that the government was providing the required support by enabling environment in terms of sustainable policies, allocation of BASA routes, provision of financial guarantees and ensuring fiscal incentives to sustain the success of the airline.
On the planned establishment of Maintenance, Repair and Overhaul (MRO) facility for the country, Sirika insisted that the ministry had already reached an advanced stage in the procurement phase.
He explained that a preferred partner had been selected for the project, while the next step would be the commencement and negotiation with the preferred partner and finalisation of Full Business Scale (FBS).
He pointed out that the proposed independent MRO facility would serve the maintenance demands of airlines in West and Central Africa and also provides maintenance for national carrier and African leasing company.
He noted that the MRO would be structured as a Build Operate and Transfer (BOT) model with government acting as both the grantor of the concession and facilitator of the project, stressing that the private partner consortium would be responsible for designing, building, financing, operating and maintaining the proposed facility for an agreed concession period.
He added that the consortium is expected to comprise of an independent MRO company, real estate development company, construction company, financial and institutional investor.
“The proposed facility will have the capacity to serve both narrow- and wide-bodied aircraft maintenance requirements and will be located in Abuja,” he said.
