Pakistan International Airlines (PIA) officially came under new management on Monday. PIA Equity Ltd, a special purpose vehicle of the Arif Habib Consortium, has taken control of the national airline.
The transition marks the first financial close of Pakistan’s largest privatisation deal. Officials described it as the start of a new chapter for the airline.
Prime Minister Shehbaz Sharif attended the ceremony. Deputy Prime Minister and Foreign Minister Ishaq Dar also participated. Chief of Defence Forces and Chief of the Army Staff Field Marshal Asim Munir was present as well.
PIA described the transition as “a bold new chapter of modernisation and global excellence.”
The airline said a Rs125 billion equity injection had fully capitalised the company. It said the funding would modernise operations, improve service standards and preserve PIA’s legacy.
“As the new ownership officially takes over today, we deeply understand that the trust of a nation isn’t simply transferred on a document. Trust is earned mile by mile, smile by smile, year by year. We know this. And we accept the challenge wholeheartedly,” the chairman of PIA Equity Ltd said.
The new management pledged to modernise the fleet. It also promised better customer service and stronger operational performance.
Government announces Rs180 billion investment
The Ministry of Privatisation confirmed that the Privatisation Commission had completed the first financial close. It called the transaction the country’s largest privatisation deal.
The total investment commitment stands at Rs180 billion. The package includes Rs125 billion in fresh capital for PIA. It also includes Rs55 billion payable to the Government of Pakistan.
“The transaction brings a total investment commitment of Rs180 billion, including Rs125 billion in fresh capital to transform PIA and Rs55 billion payable to the Government of Pakistan,” the ministry said.
The ministry said the transaction reflected Pakistan’s commitment to transparent, fair and competitive privatisation.
Prime Minister Shehbaz Sharif congratulated everyone involved.
“The successful first financial closing of the PIA privatisation transaction, and the transfer of management control to the investor consortium, marks the beginning of a new chapter for our national carrier. With a transformational investment to modernise and strengthen PIA, we are laying the foundation for its revival while reinforcing investor confidence in Pakistan.”
Deputy Prime Minister Ishaq Dar said the “complex transaction” succeeded through hard work, sincerity, efficiency and close coordination among government institutions. He said it reinforced the government’s commitment to transparent governance, economic reforms and investor confidence.
Deal follows successful second privatisation attempt
The government sold its 75 percent stake in PIA in December last year. The Arif Habib Consortium submitted the winning bid of Rs135 billion after 13 rounds of open bidding.
The consortium includes Arif Habib, Fawad Ahmed Mukhtar, Gohar Ejaz and Aqeel Karim Dhedhi. It defeated another consortium led by Muhammad Ali Tabba.
The sale marked Pakistan’s first successful privatisation since the 2005 sale of K Electric. It also completed the government’s second attempt to privatise PIA.
To attract investors, the government waived an 18 percent sales tax on aircraft leases. It also granted Rs36 billion in tax credits. Officials further extended the deadline for clearing more than Rs33 billion in liabilities owed to the Federal Board of Revenue and the Civil Aviation Authority.
Officials expect the fresh investment to strengthen PIA’s finances. They also expect better passenger services, improved efficiency and stronger international competitiveness.
