Timing of Basnet arrest suggests hidden motive
KATHMANDU, JAN 06 -
The arrest of Agni Air’s promoter Sudhir Basnet on Friday has raised questions whether his detention was for fraud or there was another motive behind.
What makes the whole event fishy is the timing of his arrest . Basnet was arrest ed a day after Agni Air was put up for auction by a consortium of banks that financed the carrier.
The police arrest ed Basnet acting on complaints filed by individuals who claimed that Basnet owes over Rs 100 million to them. However, police sources said no such cases have been registered.
For last one and half months, Basnet had been looking for buyers for Agni Air. Initially, the airline had priced its entire assets at Rs 1 billion, but the value was lowered to Rs 850 million after two-three negotiations yielded no results. It had received up to Rs 620 million by another private airline. After repeated failure to sale its property, Basnet had made his mid to bring back the airline into operation.
The airline has valued its property, including aircraft and spare parts, at around Rs 1 billion. Sources close to Basnet say his arrest could be a ‘ploy’ to sell Agni Air below its actual value.
However, Bankers say there is no connection between the auction notice and Basnet’s arrest . Interestingly, Basnet is currently not on the Agni Airs’ board. According to bankers, they were forced to go for the auction after their repeated attempts to recover loans from Basnet turned futile. “We (the banks) have no connection with Basnet’s arrest as he is not on the Agni’s board of directors,” said Grand Bank CEO Sudhir Khatri. “We have informed Agni that if it is ready to repay our loans, we will cancel the auction process,” he said.The banks on Thursday issued a seven-day auction notice for the sale of Agni’s five aircraft, spare parts and land plots in Bhaktapur. The banks-Grand Bank, Sunrise Bank and International Leasing and Finance Company-have lent Rs 650 million to the airline.
According to Agni officials, a Dornier aircraft currently costs more than Rs 200 million and is most demanded aircraft due to limited production. Similarly, Agni had purchased the Jetstream 41s at $2.2 million each five years ago. With three Jetstream 41s and two Dorniers, Agni Air is a ‘price catch’ for any potential buyers.
According to Khatri, banks gave Basnet a lot of time before putting the company up for auction. “We will follow the due process to make the auction transparent.”
However, Agni officials said they ‘smell a rat’ on the banks’ short auction notice. “Normally, banks issue a 35-day public notice before putting a collateral up for auction,” a company official said. “The process was not followed by the banks,” said source.
Khatri, on his part, said although a 35-day notice is issued generally, the seven-day notice was issued as the airline defied their repeated requests for loan repayment.
The banks were also involved negotiations with multiple parties for the sale of the airline. Another banker said they opted for the auction after their efforts to find buyers failed and they decided that auction would be the most transparent way to sell the airline.
Basnet is grappling with multiple crises as a majority of his housing projects are still incomplete, blocking his cash flow. Although the airline made a profit in the last fiscal year, it could not escape from the promoter’s liabilities in other sectors.
“Before the arrest , Basnet had called a staff meeting on Friday,” said a senior Agni Air’s official. “During the meeting, Basnet informed us that since last Sunday, he was searching for cash to resume the airline’s operation, and was likely to get the required funds,” the official added.
Basnet had estimated that around Rs 100 million was enough to bring all the aircraft back into operation and the resumption of flights would ensure Rs 1-2 million of daily cash flows to the company.
Around 300 staffers of the airline have not received salaries for the last 11-12 months. The company owes Rs 20-30 million to the employees in unpaid salaries. Fearing that the banks’ would unilaterally take the entire amount raised from the auction, employees are scheduled to meet on Sunday.
‘Conspiracy to take over Agni’
I have visited the Metropolitan Police Range, Hanumandhoka, many times in the past. But this time it’s a ploy to keep me behind the bars. If the problem can be solved by my arrest , all my depositors can file cases against me. If not, the government and the public should give me the opportunity to work so that I can repay all of them.
A conspiracy has been hatched to take over my airline. A week ago, I found a party interested to purchase my airline at Rs 930 million and I took him to Grand Bank. However, the bank did not talk to us. Then the party went to the bank alone, but he was advised not to inject such a huge amount and was told to leave without any reason.
Currently, the loans from the consortium stand at Rs 580 million. I have repaid Rs 500 million as interests as of October. I can take until mid-January to repay another installment and interest. However, I do not know why the banks issued a seven-day auction notice instead of 35 days. I was arrest ed a day after the auction notice was issued. The government, the central bank and the public should investigate the matter.
Source: The Kathmandu Post
