PIA aircraft, other assets to be mortgaged to raise Rs20bn

KARACHI: The government has decided to float Sukuk bonds to raise Rs20 billion worth debt to meet Pakistan International Airlines’ (PIA) financial needs, reported ARY News.

Sources relayed that the national flag carrier’s aircraft, buildings and other assets will be put up as collateral for the loan of Rs20 billion, which is inclusive of green shoe option of Rs5 bn.

The Sukuk having a duration of ten years will be listed at the Pakistan Stock Exchange (PSX). The PIA will use the debt to meet its financial needs.

In March, the government had rolled out three separate eurobonds in the international market with a time frame between 5 years to 30 years and an interest rate ranging between six percent to 8.87 percent.

Also Read: PAKISTAN GETS $2.5BN AGAINST EUROBOND ISSUE

The five-year eurobond rolled out with an interest rate of six per cent was able to fetch US$1 billion while another bond for a duration of 10 years with an interest rate of 7.73 percent was able to yield US$1 billion.

The 30-year Euro bond floated by the country at 8.87 percent was able to garner US$500 million.