CCP approves Holdco acquiring 100pc shareholding of PIA

ISLAMABAD: The Competition Commission of Pakistan (CCP) has approved a scheme of arrangements for acquisition of 100 per cent shareholding of Pakistan International Airlines Corporation Limited (PIA) by the PIA Holding Company Limited (Holdco).

This approval is part of the Government of Pakistan’s ongoing privatisation process for the PIA.

Holdco, a public limited company wholly-owned by the Government of Pakistan, was recently incorporated to succeed to specified assets, liabilities and subsidiaries of PIA, including its business, property, rights and obligations, both domestically and internationally. PIA, a public listed company, provides aviation and allied services such as engineering, handling, cargo, flight kitchen and training.

The federal government approved the transaction based on the ‘Divestment of PIACL - Legal segregation plan and transaction structure’, submitted by the Privatisation Division on February 6, 2024. As per the approved Scheme, Holdco will acquire 100pc shareholding of PIA, and non-core assets and non-core liabilities of PIA will also be transferred to Holdco.

The relevant market identified in this case is the real estate market in Pakistan, as the PIA owns properties across the country with homogenous competition conditions. However, the core aviation activities and allied services of PIA will remain with the company and will not be transferred to Holdco.

The CCP’s assessment concluded that the proposed transaction will not lead to the dominance of Holdco in the relevant market post-transaction, as defined under Section 2(1)(e) read with Section 3 of the Act. Therefore, CCP has authorised the merger in Phase-I.

The CCP’s prompt approval of this merger demonstrates its commitment to furthering the Government of Pakistan’s economic revival plan, particularly in attracting investment through the Special Investment Facilitation Council (SIFC).