Three Bidders Participate in the Privatization Process of Pakistan International Airlines’ 75% Stake
Three bids were submitted on Tuesday morning for the privatization of a 75% stake in Pakistan International Airlines (PIA), marking the completion of the first phase of the bidding process at 11:15am.
Confirming the development, Privatization Commission (PC) Chairman Muhammad Ali stated that the initial phase has concluded and the process will now move to the Privatization Commission for further evaluation.
The bids were received from pre-qualified entities including Lucky Cement, private airline Airblue, and investment firm Arif Habib. Meanwhile, Fauji Fertiliser and certain other potential bidders have withdrawn from the process.
According to Muhammad Ali, all bids were submitted by the December 22 deadline. The PC board is currently reviewing the bids and will deliberate on PIA’s reserve price, the exact value of which has not been disclosed. The government has emphasized that the privatization is critical to improving the airline’s financial stability and attracting substantial investment to restore profitability.
Once approved by the PC board, the reserve price will be forwarded to the Cabinet Committee for final approval. The PC board meeting is presently underway to determine the reference price, with the session scheduled to resume at 3:30pm.
Calling the development a milestone, Muhammad Ali remarked that this marks the first major privatization of a national asset in nearly two decades, describing it as a historic step for Pakistan.
Privatization Drive Gains Momentum
PIA has been incurring losses for several years due to rising debt, an aging fleet, and increasing competition. Previous governments attempted to privatize the airline, but those efforts faced repeated setbacks. The current administration, however, has reaffirmed its commitment to completing the reform process.
Under the privatization terms, new investors will be required to inject Rs80 billion into the airline over the next five years. Of the proceeds from the sale of 75% of PIA’s shares, 92.5% will be allocated directly to the airline for reinvestment, while the remaining 7.5% will be transferred to the government.
If any bid exceeds the approved reserve price, it will be opened accordingly. In the case of bids below the reserve price, the highest bidder will be given the opportunity to match it. Once a successful bidder is selected, they will have 90 days to acquire the remaining 25% shareholding.
To protect employees, the Privatization Commission has assured job security for PIA’s workforce for a period of one year. Additionally, the holding company will retain responsibility for pension liabilities and post-retirement benefits.
