The privatisation of Pakistan International Airlines has reached a decisive moment as PIA bidding intensified in the second round, with two powerful business consortiums pushing offers beyond expectations.
During the latest bidding phase held in Islamabad, the Arif Habib–led consortium emerged at the top with a bid of Rs121 billion, narrowly surpassing the Lucky Cement–led group, which offered Rs120.25 billion. The competitive escalation reflects renewed investor confidence in Pakistan’s national carrier.
Earlier in the day, sealed bids were opened in a televised session — a move aimed at maintaining transparency throughout the PIA bidding process. In that initial round, Arif Habib Group had already taken the lead with Rs115 billion, while Lucky Cement followed at Rs101.5 billion.
Following the second round, bidding was briefly paused after a request from the Lucky consortium before proceedings resumed.
Why PIA Bidding Has Gained Momentum
The renewed interest comes amid broader economic reforms backed by the International Monetary Fund, with the government pushing to privatise loss-making state enterprises. Analysts point to PIA’s improved financial outlook and the restoration of profitable European routes as key factors driving aggressive bids.
Under the transaction framework, the government has offered up to 100% ownership of PIA, with a premium applicable for stakes above 75%. The process has been conducted publicly, including live coverage, to build credibility around the PIA bidding exercise.
The Arif Habib-led consortium includes Fatima Fertilizer, City School, and Lake City Holdings, while the competing group consists of Lucky Cement, Hub Power, Kohat Cement, and Metro Ventures. Private airline Air Blue also submitted a bid of Rs26.5 billion.
The reserve price for PIA was fixed at Rs100 billion, and the next open bidding phase will begin at Rs115 billion, with increments of Rs250 million.
What Happens Next in the PIA Bidding Process
Privatisation Commission Chairman Muhammad Ali confirmed that two consortiums are seeking majority control, with options for acquiring 75% or full ownership. This marks the government’s second attempt to privatise PIA, after last year’s failed effort attracted only a single low bid.
Currently, the state holds nearly 96% ownership of PIA, which has historically drained public finances. Experts say successful privatisation could save billions annually.
Under the approved structure, 75% of shares will be sold initially, with the remaining 25% available within 90 days. Two-thirds of the sale proceeds must be paid within three months, while the remainder can be settled over a year. Only 7.5% of proceeds will go directly to the government; the rest will be reinvested into PIA.
Employees, Assets, and Financial Turnaround
PIA currently operates 38 aircraft, with 18 active, and holds landing rights at 78 global airports. Employees will retain job security for one year after privatisation, while pensions and post-retirement benefits will continue under PIA Holding Company.
Valuable properties such as the Roosevelt Hotel (New York) and Scribe Hotel (Paris) are excluded from the sale.
Financially, PIA recorded an operational profit of Rs9.3 billion and a net profit of Rs26.2 billion in 2024, following years of heavy losses. Analysts note this turnaround was possible after the government absorbed over Rs850 billion in debt, effectively cleaning the airline’s balance sheet.
The final open bidding between the two leading groups will determine the future ownership of Pakistan’s national airline — making this PIA bidding process one of the most consequential privatisation deals in the country’s history.
