Nigeria Seeks Foreign Help to Build 30-Plane, 80-Route Airline

LAGOS (Capital Markets in Africa) – Nigeria revealed plans for a new national airline and said a majority stake could be available to an overseas backer as it seeks know-how and cash to help the start-up avoid the fate of former flag carriers.

The West African state has no cap on overseas ownership of its airlines and would be prepared to offer more than 50 percent of the company — named Nigeria Air — to a strategic ally, Tilmann Gabriel, who is helping to coordinate the project, said in an interview Wednesday at the Farnborough air show.

Nigerian Aviation Minister Hadi Sirika held talks at the expo with the chiefs ofEthiopian Airlines Enterprise, Africa’s biggest carrier, and Qatar Airways, which holds a stake in British Airways owner IAG SA. Other operators are also interested, according to the executive, who said the new airline will have a fleet of 30 aircraft and operate 80 routes, half of them international, within four years.

In unveiling the plan for Nigeria Air, which will have a tail design featuring an eagle-like swirl in green and white, Sirika said that having once been dominant in African aviation, Nigeria has a “huge need and desire” for a national airline.

Africa’s most populous nation with close to 200 million inhabitants has struggled for decades to support a viable home-grown carrier, with a succession of operators collapsing or slashing routes. That’s left the oil-rich country dependent on services provided mainly by European and Persian Gulf airlines for trips beyond the region.

Airbus, Boeing Talks
Former flag-carrier Nigeria Airways collapsed in 2003, with successor Air Nigeria — founded as a joint venture with Richard Branson’s Virgin Group — folding in 2012. Private operators Aero Contractors and Arik Air were taken over by Asset Management Corp. of Nigeria in the last few years, leading long-haul flights of the latter to be suspended.

The new operator plans to begin flying in December with a fleet of 15 leased aircraft, and has started talks with Airbus SE and Boeing Co. on buying new aircraft. The requirement includes short-haul planes for local and domestic flights plus wide-bodies for flights to long-haul locations such as London and New York. Inter-continental services should begin in the middle of next year.

Ethiopian Air Chief Executive Officer Tewolde GebreMariam said in an interview Tuesday that his company was interested in the Nigerian project. Ethiopian, Africa’s only consistently profitable carrier, serves about 70 global cities and 60 across Africa from its hub in Addis Ababa. It already owns stakes in carriers in Malawi and Togo and is seeking to establish holdings in Zambia, Chad, Mozambique, Guinea and Eritrea while helping to manage existing operators in Equatorial Guinea and the Democratic Republic of Congo.

Source: Bloomberg Business News