Ethiopian Airlines plot takeover of Nigeria's flagship fleet

Arik Air has endured a series of crises but could soon be under new management

Story highlights

  • Ethiopian Airlines submit formal offer for Nigeria's largest airline Arik Air
  • Arik required a government bailout after coming close to collapse
  • Ethiopian has enjoyed rapid growth but faces unique challenges in Nigeria

(CNN)Nigeria's leading airline could soon be under new management.

Ethiopian Airlines has submitted a formal offer to take charge of troubled carrier Arik Air, which accounts for more than half of Nigerian air passenger traffic, according to official statistics.
    "We have outlined our terms and conditions to the Nigerian government and we are waiting to see if they agree," Esayas WoldeMariam, Ethiopian's managing director of international services, told CNN. "We are capable and desirous of handling the airline."
      WoldeMariam did not specify details of the offer, but added that he expects to face competition for Arik from international airlines.
      Nigeria's Ministry of Aviation did not respond to a request for comment but Godfrey Odudigbo, minister plenipotentiary at the Nigerian embassy in Addis Ababa, said that negotiations over Arik could be concluded by the end of the year.
      An Ethiopian Airlines Dreamliner jet. The company has enjoyed rapid growth in recent years.

      Bumpy ride

      Arik has been operated by the state-owned Asset Management Corporation of Nigeria (AMCON) since a government bailout in February.
      The bailout was forced by a prolonged crisis that saw services canceled, staff unpaid, and mounting debt.
      Arik's Managing Director Captain Roy Ilegbodu reported in August that the company had stabilized under AMCON's leadership, with services running smoothly and salaries paid.
      But the offer from Ethiopian may be attractive for a cash-strapped government struggling through a prolonged recession.
      Nigerian air passengers have faced frequent inconvenience from disrupted services.

      Taking off

      By contrast, Ethiopian Airlines is one of the fastest-growing and most profitable carriers on the continent.
      The airline reported a 10 percent increase in revenue to $2.4 billion for 2015/16, with a 70 percent rise in profits, and passenger numbers climbed 18 percent to 7.6 million.
      Ethiopian is pursuing ambitious development at home, with the $345 million expansion of Addis Ababa's Bole International Airport, and abroad, having acquired a 49 percent stake in Malawian Airlines and 40 percent of ASKY Airlines in Togo.
      Nigeria, with the largest population in Africa and high demand for air travel, is an attractive prospect for an ambitious airline. But it is unlikely to offer a smooth ride.