Cash-strapped Pakistan International Airlines is expected to get a new owner soon. The Government of Pakistan plans to sell a majority stake in the airline on October 31, 2024. Sources said only one bidder had submitted pre-qualification documents for airline privatization.
Prior to the deal, around six companies had been pre-qualified to bid for 60% of PIA’s shares. It is a consortium of three led by Fly Jinnah, AirBlue, Arif Habib Corporation, and YB Holdings (Private) Limited, Pak Ethanol and Blue World City. Five of these companies withdrew their bids, leaving only one in contention.
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It is said that behind the five companies’ withdrawal is a demand for full ownership, not just 60% of PIA’s shares. In response to this demand, the Pakistani government only increased its offer to 76 percent of the stake, leaving only one group as a bidder. The parties that withdrew cited concerns about the airline’s financial responsibility, aging fleet, and operational difficulties.
PIA has been in financial crisis for years. The issue came to light in 2023 when 7,000 PIA employees did not receive their salaries for November 2023. Prior to this, the European Union banned PIA in 2020, citing safety concerns.
Apart from this, the issue of fake pilot licenses in PIA and other airlines of Pakistan was also a major concern leading to safety protocols and passenger safety.
Currently, PIA has a fleet of 32 aircraft, but due to the deteriorating condition of the aircraft, lack of proper maintenance, and overall operational inefficiency, it has cost more than $500 million to invest in aircraft renewal and operation. is required.
