Government Sets Rs. 30 Billion Minimum Net Worth for PIA Bidders

The government has set the criteria for selling Pakistan International Airlines (PIA), inviting bids for up to 100% of its shares with a May 3rd deadline for initial qualifications. Interested parties must have a net worth of Rs. 30 billion, and consortium leaders must have at least Rs. 8 billion.

This sale, expected to conclude by June, includes conditions like requiring foreign investors to partner with local entities, as direct foreign majority ownership in Pakistani airlines is not allowed.

To prepare for the sale, PIA plans to offload its legacy debts into a separate entity, as recommended by the Securities and Exchange Commission of Pakistan. This move, pending shareholder approval, aims to clean up PIA’s balance sheet by transferring liabilities to a new Holding Company, improving the airline’s financial health.

The restructuring will see current PIA shareholders owning stakes in the new Holding Company, which will be publicly traded. The privatization strategy ensures the protection of employee and pensioner benefits by shifting liabilities and non-essential assets to the Holding Company, aiming for more efficient operations.