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The privatization of Pakistan International Airlines Corporation Limited (PIAC) is set to move into a decisive phase on December 23, with the Privatization Commission confirming that only three bidders remain in the race after Fauji Fertilizer Company Limited withdrew from the process.
According to the official programme released on Sunday, bids for a 75 percent stake in PIA will be submitted between 10:45 am and 11:15 am, while the bid opening is scheduled for 3:30 pm. In a move aimed at ensuring transparency, the government has directed that the bid-opening ceremony be broadcast live on television.
The remaining contenders include a consortium led by Lucky Cement, Hub Power Holdings, Kohat Cement, and Metro Ventures; another consortium comprising Arif Habib Corporation, Fatima Fertilizer, City Schools, and Lake City Holdings; and Air Blue (Private) Limited. Privatization Commission Chairman Muhammad Ali confirmed Fauji Fertilizer’s exit during a YouTube interview.
Ali explained that sealed bids will be placed in a transparent box, after which the Privatization Commission Board will determine a reference price. This price will be approved by the Cabinet Committee on Privatization (CCoP) and announced at the time of bid opening. If bids exceed the reference price, an open auction will follow, while bids below it will give priority to the highest bidder.
Under the deal structure, 92.5 percent of sale proceeds from the 75 percent stake will be reinvested in PIA, with 7.5 percent going to the national exchequer. The government will retain the remaining 25 percent stake, which bidders may choose to acquire within 12 months at a 12 percent premium.
The winning bidder will pay two-thirds of the bid amount within 90 days, while the remaining one-third will be payable within a year. Requests to spread payments over a longer period were rejected to protect the government from financial risk.
PIA currently operates 18 aircraft from a fleet of 34 and holds air service agreements with 97 countries. The airline has reported a net profit of Rs11 billion and equity of Rs30 billion, while liabilities worth Rs26 billion will be cleared by the successful bidder over five years.
