Pakistan seeks buyers for PIA stake.
By
April 4, 2024
The Privatisation Commission, following recommendations from the International Monetary Fund (IMF), announced plans to sell a majority stake (ranging from 51% to 100%) in Pakistan International Airlines (PIA).
This move, though historically unpopular, is seen as crucial for accessing further IMF funding. Interested parties have until May 3 to submit their bids, with EY Consulting appointed as financial advisor.
The restructured PIA, with reduced debt, aims to attract investors by offering a 51% or more stake in the airline. The commission aims to finalize a deal by June 24.
Despite being Pakistan’s largest airline, PIA faces stiff competition from Middle Eastern carriers due to limited direct flights.
The restructuring plan aims to separate core aviation operations from non-core aspects, significantly reducing legacy debt. PIA broke even in 2023 and aims to continue this trend in 2024.
However, concerns about governance and safety standards persist, with regulatory issues leading to a ban on lucrative routes in Europe and Britain.
The decision to privatize PIA aligns with IMF requirements for fiscal discipline and could pave the way for further financial assistance to address Pakistan’s economic challenges.
