Chairman Privatization Commission Muhammad Ali has expressed confidence that Pakistan International Airlines’ (PIA) privatization will attract bids exceeding Rs100 billion, as the process enters its final stage.
Speaking on Samaa TV's programme “Nadeem Malik Live”, Muhammad Ali said the government expects a bid of more than Rs100 billion for PIA.
He noted that the bid will be based on 75 percent of PIA’s shares, while 25 percent will remain with the government.
The privatization advisor explained that the government will receive 5 percent of the amount bid for the 75 percent shares.
He said bidders will submit two figures: one for how much they will pay to the government and another detailing how much they will invest directly into PIA.
Muhammad Ali stressed that 92.5 percent of the money from the 75 percent stake will be used for investment in PIA.
“We will ensure the money goes to PIA for revival, while the government also receives its share,” he said, adding that investment safeguards are central to the process.
Business plan
The chairman revealed that PIA has a five-year business plan focused on growth.
Currently, 18 aircraft are operational, but this number is expected to rise to 38 planes within four years. He added that PIA’s aircraft will be leased, not purchased, to manage costs.
According to Muhammad Ali, PIA currently carries around 4 million passengers annually, a figure projected to increase to 7 million in coming years.
He highlighted that PIA posted a profit of Rs11 billion last year, compared to annual losses of Rs50–60 billion in the past.
The privatization advisor said PIA’s losses were largely due to circular debt.
He stated that a net amount of Rs21 billion has been removed, while liabilities of Rs26 billion remain, clearing major hurdles ahead of the auction.
Serious bidders in race
Muhammad Ali confirmed that Arif Habib Group, Lucky Group, and Airblue are serious bidders for PIA.
Sources say three companies will participate in the bidding instead of four, with Fauji Fertilizer not bidding directly, though it may later join a successful consortium.
According to sources, Lucky Group has hired Turkey’s Pegasus Airlines as a technical consultant, while Arif Habib Consortium has engaged Sabre Aviation Partners.
Several amendments to the privatization structure were made on expert recommendations, most of which have been approved.
Auction date
The privatization process is nearing completion, with a bidding ceremony scheduled in Islamabad on December 23.
Officials say the reserve price, previously Rs85 billion, may be raised to Rs90–100 billion due to PIA’s improved financial performance and reopened European routes.
Muhammad Ali also announced plans to privatize Islamabad, Gujranwala, and Faisalabad Electric Supply Companies.
Work on the privatization of Peshawar and Hazara distribution companies is expected to begin next year.
