Government to offload 75% share in Pakistan
International Airlines (PIA)
The Pakistani government has decided
to sell a 75% stake in Pakistan International Airlines (PIA) as part of its
efforts to revitalize the struggling carrier. The successful buyer will be
required to invest at least USD 500 million over three years to recapitalize
the airline, according to an August 29 briefing to the Senate Standing
Committee on Privatisation.
Committee Secretary Usman Akhtar
Bajwa confirmed there would be no further delays, with the winning bidder to be
announced and preliminary sale agreements signed by October. This is part of
the government's broader plan to privatize several state-owned entities,
including PIA.
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Earlier this year, the government
conducted a pre-qualification process for interested buyers, with six parties
passing the initial round. These include Fly Jinnah, AirBlue, Arif Habib
Corporation Limited, and three consortia led by YB Holdings, Pak Ethanol, and
Blue World City. The Pak Ethanol consortium includes AsiaPak Investments
Limited, Swiss Aviation Group, and others, while YB Holdings’ consortium involves
AirSial, Serene Air, and Liberty Daharki Power Limited.
To facilitate the sale, the
government has shifted approximately PKR 623 billion (USD 2.23 billion) in
liabilities off PIA’s balance sheet into a separate entity. However, the buyer
will still be responsible for around PKR 220 billion (USD 789 million) in
liabilities and must inject PKR 80 billion (USD 287 million) within the first
12 months—over half of the total USD 500 million investment required over three
years.
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Currently, PIA operates a fleet of
32 aircraft but has several grounded due to maintenance issues, including all
three B777-200ERs and ten of its seventeen A320s. The new majority owner is
expected to invest significantly in modernizing the fleet and acquiring new
aircraft.
Source: https://www.ch-aviation.com/