Five prospective purchasers expressed interest in Pakistan's national airline, PIA, among them a military-related consortium.
India's Shiny Neighbor: Pakistan Opens the Doors for its Struggling National Airline
ISLAMABAD — Clinging to hope and buckling under pressure, Pakistan has received proposals from five interested parties, ranging from business groups to a military-backed conglomerate, all aiming to take over its money-strapped national airline, the Privatisation Ministry announced on Thursday.
The deadline for submitting proposals to acquire up to 100% of Pakistan International Airlines (PIA) passed on the 19th of June, marking the opportunity for a fresh start after the airline racked up over $2.5 billion in losses over the past decade. Although the airline managed to post its first operating profit in nearly 21 years last fiscal year, the stakes are high with this sale, serving as a test of Pakistan's ability to shed loss-making state-owned enterprises and fulfill conditions of a $7 billion loan from the International Monetary Fund (IMF).
The sale of PIA would mark the country's first major privatization in close to two decades, according to officials. Out of eight interested bidders, only five succeeded in submitting qualifying documents, the ministry revealed in a statement.
Take a look at the top contenders for PIA:
- Consortium spearheaded by Lucky Cement Ltd
- Comprising: Lucky Cement Ltd, Hub Power Holdings Ltd, Kohat Cement Co Ltd, and Metro Ventures.
- Representing strong industrial and financial capabilities, these companies boast prominence in the sectors of cement, power, and investments [1].
- Consortium spearheaded by Arif Habib Corp Ltd
- Consisting of: Arif Habib Corp Ltd, Fatima Fertilizer Co Ltd, real estate powerhouse Lake City Holdings, and prominent private education operator The City School.
- With a blend of financial expertise, fertilizer production, real estate, and education, this group has showcased a diversified business portfolio and ongoing interest in past PIA privatization attempts [1][4].
- Consortium involving Bahria Foundation
- Collaborators: Bahria Foundation, active domestic carrier Serene Air, and Equitas Capital LLC.
- With a military-backed foundation, an established domestic airline, and a financial backing firm, this consortium brings operational airline experience and capital investment to the table [1][2][3].
- AirBlue
- A seasoned private airline based in Karachi, AirBlue offers aviation sector experience.
- Given its prior involvement in the 2024 unsuccessful bid, AirBlue continues to impose its expertise in airline operations [1].
- Fauji Fertilizer Company Limited
- A military-backed large fertilizer company situated in Rawalpindi.
- Financially robust and submitting EOIs with supporting documents, Fauji Fertilizer Company Limited represents a distinctive military-affiliated interest, separate from Bahria Foundation [1][4].
Also, a group of PIA employees, aided by trade union leaders, submitted a combined bid seeking priority rights to purchase the airline. Despite presenting their proposal, they were not considered among the top five qualified bidders [1].
These five finalists exhibit an assortment of industrial conglomerates, financial investors, militarily-affiliated entities, and experienced domestic airlines, each possessing unique qualifications vital for managing and revamping PIA. The sale marks a crucial milestone in Pakistan's initiative to privatize loss-making state companies and comply with IMF loan conditions [2][3][4].
[1] [Reference available upon request][2] [Reference available upon request][3] [Reference available upon request][4] [Reference available upon request]
- The consortium spearheaded by Lucky Cement Ltd, which includes Lucky Cement Ltd, Hub Power Holdings Ltd, Kohat Cement Co Ltd, and Metro Ventures, represents strong industrial and financial capabilities in the sectors of cement, power, and investments.
- The consortium involving Bahria Foundation, an active domestic carrier Serene Air, and Equitas Capital LLC, with a military-backed foundation, an established domestic airline, and a financial backing firm, brings operational airline experience and capital investment to the table.
