PIA privatisation: Fauji Fertiliser opts out of direct bidding

Privatisation Commission officials have said that three companies, instead of four, will participate in the bidding process for the privatisation of Pakistan International Airlines (PIA), as Fauji Fertiliser will no longer take part directly in the bidding.

According to officials, the privatisation of the national airline is scheduled to take place tomorrow (Tuesday).

The bidding process will now include three companies, while Fauji Fertiliser may join the successful consortium at a later stage.

Officials stated that all matters related to PIA’s privatisation have been finalised and preparations are complete. The buyer of the national airline will be exempt from paying sales tax on the purchase of new aircraft.

They added that in the previous attempt, the investor was required to clear liabilities amounting to Rs33 billion.

Under the current arrangement, the buyer will not be required to pay Rs26.6 billion in dues owed to the Federal Board of Revenue, nor will they have to settle Rs7 billion payable to Pakistan Aviation.

Between 51 per cent and 100 per cent of PIA’s shares will be sold, and all outstanding liabilities have been resolved prior to the bidding date. Officials noted that during the previous attempt, timely approval for GST relief from the IMF could not be obtained.

They expressed confidence that a better price is now likely, as routes to the UK and Europe have also been restored.

Investors participating in the privatisation process will be required to submit a bid bond of Rs2 billion, while financing of Rs80 billion will have to be arranged immediately after privatisation. Officials said the privatisation of the national airline would be ensured in a transparent manner.

It is worth noting that the bidding process will include the Arif Habib, Airblue and Lucky consortiums.