Nigerian tycoon Wale Babalakin writes off a N132 billion airport debt and hands back MMA1 to the government in a deal that finally ends a 20-year fight over Lagos's private terminal

Wale Babalakin's Bi-Courtney Aviation Services Limited has written off a N132 billion judgment debt, relinquished its claims over Lagos's main domestic terminal and dropped the exclusivity clause that had blocked new private airport development in the city, in a comprehensive settlement that Aviation Minister Festus Keyamo announced on Thursday as the definitive end of one of the most protracted commercial disputes in Nigerian infrastructure history.

The Federal Executive Council, presided over by President Bola Tinubu, approved the settlement terms at its Thursday meeting in Abuja. Keyamo disclosed the details to State House correspondents afterward, describing the agreement as a decisive reset of an arrangement that had been locked in litigation and acrimony for more than 2 decades.

"I can happily tell you that this government has resolved that issue once and for all," the minister said. "Council today approved the terms of the agreement we reached with Babalakin to settle all the vexed issues surrounding that airport."

A formal signing ceremony is to be held in Lagos, where remaining technical details will be publicly disclosed before all stakeholders.

What each side gave up

The deal required significant concessions from both parties. The burden was heavier on Bi-Courtney.

The Supreme Court had previously ruled in Babalakin's favour on the question of MMA1, ordering the Federal Government to pay N132 billion plus interest accrued from 2009. That figure, with interest compounded over 17 years, would have been a number the government could not practically pay. Keyamo was frank about this in his remarks. "I told him nobody was going to pay that. He wrote it off," the minister said.

Bi-Courtney also agreed to hand back full operational control of MMA1, the main domestic terminal at the Murtala Muhammed Airport complex, to the Federal Government. The company had long argued that its original concession covered MMA1 as well as the newer terminal it built, a position the Supreme Court had upheld but which the government never accepted in practice. That argument is now off the table.

The third major Bi-Courtney concession was the removal of the exclusivity clause in the original concession agreement. That provision had granted Bi-Courtney sole rights to operate a private airport within a defined radius of Lagos, a clause that Keyamo said was wrongheaded from the start and had prevented the development of competing aviation infrastructure in the city. The proposed Lekki Airport, which had been held hostage to the exclusivity argument, can now proceed.

What the government gave Babalakin

In exchange, the Federal Government made 3 concessions of its own.

Most immediately consequential is the restoration of regional flight operations to MMA2. Bi-Courtney had invested more than N600 million in infrastructure to handle regional flights at the terminal, but that operating authority was withdrawn by the Jonathan administration and never restored. The revenue loss over more than a decade of blocked regional operations has been significant. "Immediately after today, the federal government will now begin to earn its own share from the operations of MMA2," Keyamo said, signalling that the revenue-sharing arrangement now also flows in reverse.

The government also returned to Bi-Courtney the concession for a 5-star hotel and conference centre opposite MMA2, which had been revoked by a previous administration and sat unfinished for years. The restored concession comes with conditions: Bi-Courtney has 24 months to complete the facility, and the government retains a shared stake in operations rather than leaving it as an exclusive concession. "We told him we will not tolerate any delay again," Keyamo said.

Apron expansion at MMA2 to accommodate additional aircraft was also approved as part of the settlement.

The story behind the story

The Murtala Muhammed Airport Terminal 2 is one of the most unusual infrastructure assets in Africa. Babalakin built it using entirely private capital, without government support, under a Design-Build-Operate-Transfer concession awarded in 2003 after fire destroyed the old domestic terminal. When it opened in 2007, it became the first airport terminal on the continent to be built wholly with private money. That achievement was immediately overshadowed by a dispute about whether the airlines operating domestic flights would actually be required to use it.

The government's failure to compel full domestic flight migration to MMA2, combined with the withdrawal of regional flight authority and the various contractual disputes that multiplied over the following years, left Babalakin running a terminal that was underutilised relative to the concession's commercial logic. The legal fight generated a Supreme Court judgment in his favour and a N132 billion award that no government was actually going to pay.

Babalakin, 65, is one of Nigeria's most prominent lawyers and infrastructure developers, senior advocate of Nigeria and founder of Babalakin and Co, one of the country's largest commercial law firms. He holds an LLM and PhD from Cambridge University and has served as Pro-Chancellor of the University of Lagos and the University of Maiduguri.

The Tinubu administration, through Keyamo, has spent months negotiating the settlement. Whatever the financial cost to Babalakin of writing off N132 billion, the deal delivers what the concession was supposed to deliver 19 years ago: a functioning commercial terminal with revenue-generating regional routes, an expanded apron and a government that is now a partner in the terminal's commercial performance rather than an obstacle to it.