Thursday, August 21, 2008

"Virgin Nigeria not productive" - Richard Branson reiterates

In the wake of the face-off between the Federal Government and Virgin Nigeria Airline, Virgin Atlantic, the technical partner to the Nigerian flag carrier, it was alleged that Virgin Atlantic is currently reviewing its 49 per cent minority share­holding in Virgin Nigeria. While Nigerian institu­tional investors own 51 per cent equity in the airline, Virgin Atlantic owns the remaining 49 per cent.
President of Virgin Atlantic, Sir Richard Branson, stated clearly to journal­ists on Tuesday that "talk of Virgin dumping Virgin Nigeria is absolute rub­bish. The intention has always been for the airline ultimately to be wholly owned by Nigerian investors. It is now time for Virgin Nigeria to go its own way with local share­holders."
After a forceful eviction of Virgin Nigeria out of the international wing of the Murtala Muhammed Airport, Lagos last week Sir Branson recounted that "Virgin Nigeria signed a Memorandum of Understanding in good faith with the Nigerian government in 2004 and provided all necessary doc­umentation, as required by the government.
As with every government we work with around the world, a deal is a deal and Virgin Nigeria should be allowed to operate its domestic flights from the interna­tional terminal in Lagos, which offers passengers seamless connections between Virgin Nigeria services. Businesses need stability and certainty in order to invest in Nigeria."
He also appraised that since it started operations in 2005, Virgin Nigeria has been run by a local management team, based in Lagos, which Virgin Atlantic has no control over, adding that Virgin Atlantic has had no financial benefit from Virgin Nigeria in respect of leases, rental or facilities during this time. He added that in fact, Virgin Nigeria has benefit­ed from highly attractive lease rates offered by Virgin Atlantic, reiterating that while royalty fees are payable for the use of the Virgin brand, Virgin Nigeria has not paid any­thing since its launch.However, the Presidency, on Sunday denied that there was any clause in the "Memorandum of mutual undertaking on the estab­lishment of a flag carrier between the Government of the Federal Republic of Nigeria and Virgin Atlantic Limited/Virgin Airways Limited" allowing it to use the international wing for its local opera­tions.