​PIA's new owners to be revealed tomorrow as live broadcast of bidding set for 3:30pm

Pakistan will proceed with the privatization of Pakistan International Airlines on Tuesday after completing preparations for the bidding process, Privatization Commission officials said.

Three companies, instead of four, will participate in the bidding for the national carrier, according to officials at the Privatization Commission. Fauji Fertilizer Company will not take part in the bidding directly but may join the successful consortium at a later stage, the officials said.

Submitted bids will be opened at 3:30pm tomorrow and the process will be broadcasted live on television.

Officials said all matters related to the privatization have been finalized and preparations are complete. The successful bidder will be allowed to acquire between 51% and 100% of PIA’s shares.

As part of revised terms aimed at attracting investors, the buyer will not be required to pay sales tax on the purchase of new aircraft. Officials said liabilities that weighed down the previous bidding attempt have also been addressed.

In the earlier privatization round, investors were required to clear outstanding dues of PKR 33 billion, including PKR 26.6 billion payable to the Federal Board of Revenue and PKR 7 billion owed to Pakistan Aviation. Officials said these liabilities will not be transferred to the new owner this time, as the issue of PIA’s payables has been resolved ahead of the bidding date.

The changes follow a failed attempt at privatization, when the government received a bid of only PKR 10 billion against a reserve price of PKR 85 billion, prompting authorities to revise the structure and terms of the transaction.

Officials said the previous process was also affected by delays in securing a goods and services tax concession from the International Monetary Fund, which has since been addressed. In addition, the reopening of PIA’s routes to the United Kingdom and Europe has improved the airline’s prospects, increasing expectations of a better valuation.

Under the bidding rules, investors participating in the process are required to submit a bid bond of PKR 2 billion. Officials said the successful bidder will also be required to arrange financing of PKR 80 billion for PIA immediately after privatization.

Privatization officials said the process would be conducted with full transparency.