Pakistan’s national carrier PIA sold for Rs135bn
Islamabad, Hilal Ahmad, December 24, AZERTAC
The Pakistani government has succeeded in privatizing the state owned Pakistan International Airlines (PIA) marking the completion of the first major privatization process in two decades.
The consortium of Pakistan's renowned businessmen offered the highest bid of Rs135 billion for the 75% shares of the PIA.
The long awaited bidding process for the privatization of PIA concluded with the Arif Habib Group emerging as the winner after a second round with a Rs135 billion ($486 million) bid in the initial stage, three prequalified bidders submitted offers for a 75 percent stake in the state carrier PIA, with the Arif Habib Group opening with a bid of Rs115 billion, ahead of Rs101.5 billion from the Lucky Group and Rs26.5 billion from Pakistan’s private airline Airblue.
The Pakistan International Airlines, founded in 1955 and once a symbol of the country's national pride remained a fiscal burden on the state exchequer amid years of losses and shrinking operations. However, a consortium led by Arif Habib Corporation emerged as the top bidder on Tuesday for a 75 per cent stake in the national carrier the PIA, offering Rs135 billion in what authorities hailed as a landmark moment. The privatization of PIA marked Pakistan’s first major privatization in many years.
In recent years, the state carrier PIA had been incurring losses of about Rs50 billion annually, which are expected to end with its transfer to the private sector. As per reports, only 18 of its 34 aircraft are currently operational. Soon after winning the bidding process, the consortium leader Arif Habib while talking with reporters said that PIA under the new administration would expand its fleet. He said the number of planes would be increased to 38 in the first phase and to 65 in the second phase of the turnaround plan.
Pakistan’s Prime Minister Muhammad Shehbaz Sharif has termed the privatization of PIA as a historic day for Pakistan. He said it was our firm commitment to the people of Pakistan that speedy and concrete steps would be taken to privatize loss-making state-owned enterprises that have been a burden on the economy.
For the last many years, the Pakistani government tried its best to privatize the PIA which in the past had remained one of the most credible and well known airlines for the travellers across the country and globe. The bids in Islamabad were opened and concluded in a live, televised ceremony in the presence of bidders and media representatives besides the government officials.
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