AMCON expects loss from N4bn private jet sale

Managing Director, AMCON, Mr. Mustafa Chike-Obi

The Asset Management Corporation of Nigeria will lose money from the proposed sale of a N4bn Challenger private jet it took over from one of its debtors last year, the Managing Director, AMCON, Mr. Mustafa Chike-Obi, has said.

An online portal, aircraftcompare.com puts the cost of the Challenger jet at $27m (about N4bn).

Chike-Obi admitted that the corporation made a mistake by taking over the purchase of the jet from its debtor, who had deposited $4m with the manufacturers for its acquisition.
He, however, gave an assurance that the bad debt manager would sell the jet it had put for sale since last year, adding that the experience represented a learning moment for the corporation.

Chike-Obi said, “We bought an asset. A debtor had deposited $4m to buy a private jet and we told him he could not buy a jet. He said take over my deposit but give me credit.

“It is a learning experience for us. I have never sold an aircraft before. We thought it would be easier to sell than it has turned out to be. It was a mistake and we will lose some money over that mistake. It was a learning experience, it was done with the best intention. We will sell the plane soon and move on from there.”

Chike-Obi clarified that assets belonging to the corporation could not be categorised as public assets because AMCON had borrowed money from the bond market to buy them.

He said until the agency had finished paying up its debts, none of its assets could be classified as belonging to the public.

The PUNCH had in April exclusively reported that the brand new Canadian-made private jet might be sold at a loss.

The report came seven months after AMCON had been battling to get a suitable buyer for the state-of-the-art aircraft.

The report had stated that AMCON might eventually be forced to sell the Challenger 605 luxury private jet at a huge loss in order to stem further losses.

AMCON, the bad debt manager created after the banking sector crisis of 2009, had in August last year put the jet up for sale through a public notice.

The PUNCH had reported that the corporation was incurring storage costs on the plane in order to continue to keep it airworthy.

While the prices of private jets have been falling due to low global demand, sources said AMCON had bought the jet at a relatively high price.

Aviation experts said the more the aircraft stayed on the ground, the more it would be losing value, adding that aside from the minor costs of keeping it current, the plane was already depreciating, a situation that any prospective buyer would put into consideration.
Source: The Punch