WASIM IQBAL

ISLAMABAD: Bidding for Pakistan International Airlines (PIA) is going to take place today (Tuesday).

Submissions will be accepted from 10:45 AM to 11:15 AM, and the bids will be opened later this afternoon at 3:30 PM.

The bidders are: 1) A consortium comprising Lucky Cement Limited, Hub Power Holdings Limited, and Kohat Cement Company Limited, 2) Metro Ventures (Private) Limited, a consortium comprising Arif Habib Corporation Limited, Fatima Fertiliser Company Limited, City Schools (Private) Limited, and 3) Lake City Holdings (Private) Limited and Air Blue (Private) Limited.

The Fauji Foundation has withdrawn from the bidding process to acquire PIA, leaving three bidders in the race ahead of the submission and opening of bids.

According to the Privatisation Commission, in the bidding process, a 75 percent stake will be offered. From this 75 percent, 92.5 percent of the proceeds will go into the company, while 7.5 percent will go to the government.

Under the current structure, 92.5 percent of proceeds are reinvested into the company, and additional investment may be needed. The government will retain the remaining 25 percent stake, with the successful bidder given the option to acquire it later. Based on the PIA business plan, the fleet of 18 aircraft is projected to double within 3–4 years, according to the commission.

During an interview with a digital news platform, Muhammad Ali said the reference price will be reviewed and approved by the Cabinet Committee on Privatisation and announced at the time of bid opening. If bids exceed the reference price, an open auction will be held, while bids below the reference price will be assessed by giving preference to the highest offer.

Following the bidding, the federal cabinet is expected to approve the transaction within days. The commission will then proceed with signing documents submitted by bidders and will have 90 days to complete procedural requirements, including the transfer of assets, liabilities, and leased aircraft.

Muhammad Ali confirmed that the bidders have to finalise the decision of whether they want to acquire the remaining 25 percent or not, within the stipulated 90-day period.

The winning bidder will be required to deposit two-thirds of the bid amount within 90 days, with the remaining one-third payable within one year. The government rejected a proposal allowing payment over a full year, citing risks linked to changes in the airline’s performance.

PIA currently operates 18 aircraft out of a total fleet of 34 and holds air service agreements with 97 countries, along with landing rights in more than 170 countries. The airline reported a net profit of Rs11 billion and equity of Rs30 billion, while liabilities of Rs26 billion will remain with PIA and be paid over five years.

Under the proposed terms, no employee can be laid off for one year, with pensions and employee benefits protected. Pension liabilities of retired employees, including medical benefits and discounted tickets, will be borne by the holding company.

PIA’s workforce has declined from 11,500 employees in 2011 to 6,500.