After years of delays and failed attempts, Pakistan International Airlines (PIA) has finally been taken out of government ownership in what officials are calling a historic privatisation deal.
A consortium led by the Arif Habib Group won the auction for a controlling stake in the national flag carrier with a winning bid of Rs135 billion, marking Pakistan’s first major privatisation in nearly two decades.
The high-stakes auction, held in Islamabad, was conducted through a transparent and televised bidding process, aimed at restoring investor confidence and demonstrating the dedication and rigorous will of the government to bring economic reforms.
On Tuesday, the Pakistan government completed the sale of a 75% stake in PIA, ending years of stalled efforts to privatise the loss-making airline. The winning consortium will take over management control of PIA.
Intense Bidding Sees Last-Minute Twist
Three pre-qualified bidders entered the race: a group led by Lucky Cement, private airline Airblue, and the Arif Habib-led consortium. After sealed bids were opened, the process moved into a live open auction.
The Arif Habib Consortium includes Arif Habib Corporation Limited, Fatima Fertiliser Company Limited, City Schools (Private) Limited, and Lake City Holdings (Private) Limited.
The Fauji Foundation withdrew from the bidding process to acquire Pakistan International Airlines (PIA). Its exit reduced the number of bidders to three, just ahead of the submission and opening of bids.
In the first round, Lucky Cement offered Rs 101.5 billion, Airblue submitted Rs 26.5 billion, and the Arif Habib consortium bid Rs 115 billion. Airblue exited after its offer failed to meet the government’s benchmark price of Rs 100 billion, turning the contest into a head-to-head battle.
The second round proved decisive. Lucky Cement raised its offer to Rs 134 billion, but the Arif Habib consortium responded immediately with Rs 135 billion. With the price exceeding its final position, Lucky Cement withdrew, congratulating the winning bidder and ending the auction.
Lucky Consortium later congratulated the winning bidder.
New Owners Promise Fleet Expansion and Stability
Speaking after the win, Arif Habib described PIA as a “national institution” and said the new owners were committed to reviving its lost prestige. He also let the cat out of the basket by telling plans to expand the airline’s fleet in phases, initially increasing it to 38 aircraft and later to 65, depending on market demand.
He also reassured employees, saying the consortium is meant to
- Build trust
- Unlock potential
- Strengthen PIA as a competitive airline once again
Govt Hails Transparency, Calls Deal Historic
Out of the total Rs 135 billion, the government will receive Rs 10.12 billion in cash, while the remaining amount will be invested directly into PIA.
Finance Minister Muhammad Aurangzeb praised the auction’s transparency, calling it a milestone achieved through patience and reform. Adviser on Privatisation Mohammad Ali said the competitive bidding reflected strong investor confidence and would open doors for further privatisations.
Prime Minister Shehbaz Sharif called the sale a “historic day for Pakistan,” saying it fulfilled the government’s promise to privatise loss-making state-owned enterprises that burden the economy. Several ministers echoed the sentiment, noting that the lifting of European and UK flight bans had significantly improved PIA’s valuation.
A Signal to Investors and IMF
Economists keep on saying that the successful sale sends a strong signal to investors, lenders, and the IMF, which has long urged Pakistan to reform state-owned enterprises. With PIA finally privatised, analysts keep on believing this deal could set the tone for future economic reforms and help in stabilizing Pakistan’s struggling aviation sector.
As one expert noted, after nearly 20 years, Pakistan has taken a long-awaited step forward — and this time, the market responded.