Investor challenges Bhoja Air over sale of assets

Amid inquiry, Bosal claims aircraft was sold without paying off CAA liabilities.

KARACHI:

Bhoja Air’s majority shareholders have allegedly sold most of the airline assets despite a pending judicial inquiry and the Federal Investigation Agency (FIA) probe into the fatal crash of one of its aircraft that claimed 127 lives.

Bhoja’s Managing Director Arshad Jalil, who along with his family holds an 80% stake, has sold the aircraft and an associated engineering firm in connivance with the Civil Aviation Authority (CAA), said a letter submitted before the Judicial Commission.

“The directors of Bhoja Air Limited sold all assets of the company including 2 aircraft with the help of CAA without paying the liabilities of CAA,” said Yousuf Naz Bosal, who claims to be a renowned businessman holding dual-nationality.

“As far as the PAES (Pak Aviation Engineering Services) is concerned, they have shifted all spare parts and other expensive tools and machinery to their office in Sharjah, UAE,” added the letter, which was sent to the commission on February 22, 2014.

The Judicial Commission, headed by Justice (retd) Ghulam Rabbani, was formed in July last year after the Islamabad High Court noted delays in the investigation while hearing pleas from the victims’ families

Bosal is contesting a case against Bhoja in the Sindh High Court that involves an earlier agreement to sell the company including the Regular Public Transport (RPT) licence to him.

“I signed an MoU with Bhoja in January 2013 to buy the airline for Rs52 million,” he told The Express Tribune. “But I found out during the due diligence that they can’t proceed because of the FIA inquiry. I asked for a clarification, which they never gave.”

According to Bosal, sponsors of the airline had started negotiations with other industry players in hope of getting a better price.

“I have requested the court to make them fulfil their obligation under the agreement. I have also paid them Rs500,000 in cash as advance.”

No one from Bhoja Air was available for comments.

CAA spokesman Abid Qaimkhani also did not respond to questions sent to him. He, however, insisted that the judicial commission had not asked CAA to stop Bhoja from selling the assets.

People close to Arshad Jalil say Bosal was dillydallying about bringing the proposed investment. “Even the cheques he submitted bounced. This guy wasn’t serious.”

They also insist that selling the aircraft cannot be part of the deal. “The aircraft were owned by a leasing company and not by Bhoja Air.”

Jalil, a commercial aviation veteran, headed Shaheen Air for many years before launching an airline of his own. Under an arrangement, he had bought the airline licence from Farouk Bhoja. But the money was never paid.

Jalil had used his own special purpose vehicle company called Jet Aviation to buy aircraft for the airline. This company, registered outside Pakistan, bought four Boeing 737 aircraft, which were subsequently leased to Bhoja Air.

One plane AP-BKF has been now been leased to Shaheen Air.

The CAA suspended Bhoja operations soon after the accident. Jalil was nominated in an FIR while the name of airline’s chairman Farouk Bhoja was put on the exit control list.

Published in The Express Tribune, March 2^nd, 2014.

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