Arif Habib Consortium Wins Bid for PIA Privatization After Intense Competition

PIA was bought for Rs 135 billion / Photo File (Associated Press of Pakistan)

Pakistan International Airlines’ (PIA) long-awaited privatization process concluded on Friday, with the Arif Habib Consortium emerging as the winning bidder after a closely contested auction. The consortium secured a 75 percent stake in the national flag carrier for Rs135 billion, officials confirmed.

According to details, the Lucky Cement Consortium submitted the second-highest bid of Rs134 billion, narrowly missing out on the acquisition. Another bidder, Airblue, offered Rs26.5 billion for the airline’s shares, significantly lower than the leading bids.

Chairman of the Privatization Commission, Muhammad Ali, said the privatization of PIA is a key component of the government’s economic reform agenda. Speaking to the media, he stated that the bidding process was announced to potential investors in April, with two bidders expressing interest in acquiring 100 percent shares and two opting for a 75 percent stake.

He explained that 92.5 percent of the proceeds from the sale would be reinvested into PIA to strengthen its operations, while the remaining 7.5 percent would go to the government. The government had earlier decided to sell between 51 and 100 percent of the airline’s shares as part of its restructuring plan.

Muhammad Ali emphasized that the government’s objective was not merely to sell the airline, but to place it on a sustainable financial footing. Under the plan, the remaining 25 percent shares will be offered for sale within 90 days, while two-thirds of the payment from the winning bidder will be received upfront.

Privatization officials said the new investor will be required to invest Rs80 billion over the next five years to stabilize PIA. The investor will gain control of aviation operations, cargo business, training wing, and catering services, while employees will receive job protection for at least one year.

Officials added that pensions and post-retirement benefits will remain the responsibility of the holding company, while the new owners will be accountable for salaries, benefits, and professional management to ensure the airline’s long-term financial recovery.