By Staff Reporter
ISLAMABAD: Three groups submitted bids to acquire a controlling stake in Pakistan International Airlines Corp. Ltd., the debt-laden flag carrier, in what the government touted as the nation’s largest-ever privatisation deal and a key plank of its economic overhaul under an International Monetary Fund bailout.
Sealed offers from a consortium led by Lucky Cement Ltd., another including private airline Airblue Ltd. and a third headed by investment firm Arif Habib Corp. were deposited Tuesday morning in a transparent box during a public ceremony broadcast on state television.
Representatives of the bidding groups arrived one by one, briefly fumbling as they pushed envelopes through the slot. The bids are set to be opened at 3:30 pm local time in the presence of the groups, with the process concluding based on agreed terms. Muhammad Ali, adviser to the prime minister on privatisation, will hold a press conference afterward.
The entire event is being telecast live across TV channels and government social media handles, underscoring efforts to ensure transparency after last year’s failed attempt. “God willing, we will get a good bid, there will be good investment and we will succeed,” Ali told reporters on Tuesday.
Prime Minister Shehbaz Sharif, addressing a federal cabinet meeting, thanked officials and the Privatization Commission for their work, calling the process “transparent” and the transaction Pakistan’s biggest to date. “Today, as the bidding starts the bids will come in sealed envelopes, there will be see-through boxes, there will be a live telecast. When the price is determined, the envelopes will be opened, then they will compete, and whoever has the highest bid will succeed,” Sharif said. “Only God knows how high the bid will go, but the process must come back to the cabinet.”
The reference price for the auction will be approved by the Privatization Commission Board and the Cabinet Committee on Privatization only after the bids are in hand. Subject to that sign-off, the sealed offers will be revealed in the second round later Tuesday.
This marks Pakistan’s second shot at offloading PIA, a once-prestigious airline now mired in losses and operational woes. A televised auction last year fizzled when the sole bidder, Blue World City consortium, balked at matching the government’s minimum expectation of Rs85.03 billion and held firm at its Rs10 billion offer for a 60% stake — the first major privatization flop in almost two decades.
The government relaunched the process with a call for expressions of interest in April, initially due June 3 but extended to June 19. It’s aiming to divest 51% to 100% of the carrier to generate revenue and revamp bleeding state-owned enterprises, as required under a $7 billion IMF program.
Under the terms, a 75% stake is on offer, with 92.5% of proceeds reinvested into the company and 7.5% going to the government. The state will hold onto the remaining 25%, though the winner can opt to buy it later. Based on PIA’s business plan, its fleet of 18 aircraft is expected to double within three to four years.
The bidders include: a consortium of Lucky Cement, Hub Power Holdings Ltd. and Kohat Cement Co.; Metro Ventures Pvt. comprising Arif Habib, Fatima Fertilizer Co. and City Schools Pvt.; and a group of Lake City Holdings Pvt. and Airblue. Fauji Foundation pulled out ahead of the deadline, trimming the field to three. The Lucky consortium’s representative submitted first, followed by the Airblue-Arif Habib group. A unique clause bars the two losing bidders from any future role in PIA’s management. Ali said unsuccessful groups have no right to join the winner, though non-participants like Fauji could potentially team up later.
Ahead of the auction, reports emerged of a proposed behind-the-scenes deal to split the stake among three of the four interested parties, which collapsed when the Lucky Cement group, led by Muhammad Ali Tabba, declined. Both Tabba and a senior government official confirmed the informal interaction but said it wasn’t brokered by authorities. Tabba voiced confidence in the process, noting the proposal came after a meeting in Islamabad that he chose not to pursue.
“Today’s PIA bidding is built on transparency, efficiency, and responsibility—supporting fairness, accountability, and public trust through a clear process,” the Privatization Commission said in a statement.
The sale is central to Sharif’s reform agenda, with the government pledging a “credible, open and authentic” procedure in line with regulations. Success could unlock funds to ease fiscal strains, while failure risks further IMF scrutiny amid Pakistan’s push to stabilize its economy.
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