In a major development in Pakistan’s privatization drive, the Arif Habib Consortium has expressed its intention to purchase the remaining 25% shares of Pakistan International Airlines (PIA). According to reports, the consortium has informed the government that it is prepared to pay Rs 45 billion for the final stake in the national flag carrier.
This move comes after the consortium successfully acquired 75% shares of PIA in a competitive bidding process, marking one of the most significant privatization deals in Pakistan in the past two decades.
Rs 45 Billion Offer for Complete Ownership
Sources reveal that the Arif Habib Consortium is ready to pay Rs 45 billion to secure the remaining 25% stake, aiming for full administrative and operational control of the airline.
However, officials indicate that the sale of the remaining shares is conditional upon the fulfillment of the existing agreement between the government and the consortium. The final approval will depend on compliance with previously agreed terms and regulatory requirements.
If the deal proceeds, the consortium will gain complete ownership and control of PIA’s management structure.
Pakistan Receives Three Bids for Privatisation of PIA
75% Stake Acquired for Rs 135 Billion
Earlier, the Arif Habib Consortium won the privatization bid by offering Rs 135 billion for 75% of PIA’s shares. The bid narrowly surpassed its closest competitor, the Lucky Consortium, which offered Rs 134 billion.
Under the terms of the agreement:
- The government is set to receive Rs 10.2 billion in immediate cash.
- The privatization is expected to save approximately Rs 35 billion annually in subsidies and operational losses.
- The deal marks the first large-scale privatization in nearly 20 years.
The acquisition is seen as a turning point for the struggling airline, which has faced financial and operational challenges for years.
Strong Competition During the Bidding Process
The privatization process witnessed strong competition among major business groups.
In the initial bidding phase:
- The Arif Habib-led consortium initially offered Rs 115 billion.
- The Lucky Group consortium submitted Rs 101 billion.
- Airblue placed the lowest bid of Rs 26.5 billion.
The bids were reviewed by the Privatisation Commission of Pakistan, which set the reserve price at Rs 100 billion.
The second and final round of open bidding between the Arif Habib Group and the Lucky Group ultimately determined the winner, with the Arif Habib Consortium emerging victorious.
Government officials ensured full transparency by broadcasting the bidding process live on television and streaming it on official social media platforms.
Major Milestone in Economic Reform Agenda
Adviser to the Prime Minister on Privatization, Muhammad Ali, described the development as a “major milestone,” emphasizing that no large-scale privatization had been completed in the past 20 years.
The privatization of PIA is part of Prime Minister Shehbaz Sharif’s broader economic reform agenda. The government aims to restructure loss-making state-owned enterprises and reduce the financial burden on taxpayers.
Officials believe that transferring PIA to private ownership will:
- Improve operational efficiency
- Enhance financial performance
- Restore investor confidence
- Strengthen Pakistan’s investment climate
Expected Management Changes After Privatization
Sources suggest that significant changes in PIA’s management structure are expected by the end of April this year. The restructuring process is likely to focus on improving governance, route optimization, cost control, and service quality.
Analysts say that under private management, PIA may regain its competitive position in regional and international markets.
Previous Failed Privatization Attempt
Last year, the government attempted to privatize a 60% stake in PIA with a minimum price of $305 million. However, the only bid received was $36 million from real estate developer Blue World City, which later withdrew due to financial concerns and operational challenges associated with the airline.
The latest successful bidding process is therefore considered a significant breakthrough in Pakistan’s privatization efforts.
A New Chapter for PIA
With the Arif Habib Consortium now seeking full ownership by acquiring the remaining 25% stake, the future of PIA appears to be entering a new phase.
Industry experts believe that private-sector management could help modernize operations, improve fleet management, and rebuild the airline’s international reputation.
If finalized, the Rs 45 billion offer for the remaining shares will complete the transition of PIA from a state-owned entity to a privately managed national carrier, marking a historic moment in Pakistan’s economic reform journey.
The coming months will determine how effectively the new ownership structure can revive the airline and restore its former status as a leading flag carrier in the region.
