New round of bidding for PIA majority stake to begin next week

ISLAMABAD: Days after Pakistan International Airlines (PIA) posted its first annual profit in over 20 years, the government announced on Thursday it will invite expressions of interest next week for the airline’s sale.

Authorities have been seeking to sell a 51-100% stake in the debt-ridden airline to raise funds and reform cash-draining, state-owned enterprises as envisaged under a $7 billion International Monetary Fund programme.

Its failed attempt to privatise the PIA last year received a single offer, well below the asking price of more than $300 million.

The Privatisation Commission board has approved seeking new bids, the ministry said in a statement.

"The board approved the pre-qualification criteria for selection of prospective bidders," it said. It added new expressions of interest in buying between 51 and 100% of the airline would be sought next week.

Pakistan has shifted almost all of the national carrier's legacy debt to government books after issues raised by bidders led to the failure of the last privatisation attempt.

Muhammad Ali, the adviser on privatisation, said last week all the issues raised at the time of last year's failed attempt had been dealt with.

The government plans to complete the airline's privatisation before the end of this year.

Prime Minister Shehbaz Sharif last year announced plans to sell all SOEs.

The adviser in his last week's statement said that the process to privatise power distribution companies had also started, terming it a "high priority transaction".

He said some companies previously due to be sold in the second phase were being pushed into the first phase.

The adviser said the government had appointed Jones Lang LaSalle to advise on exploring different sales options for the PIA-owned Roosevelt hotel building in Manhattan, New York.

They include selling the building as it is or opting for a joint venture with a top-tier developer, which has the potential to generate proceeds five times higher, Ali said.