Potential Pakistan International Airlines (PIA) buyers have rejected the government’s stipulated conditions for finalizing any purchase agreement.
The bidders have expressed reservations about committing to a $500 million investment in PIA, expanding the fleet, or maintaining service on specific routes.
Reports indicate that potential buyers prefer to reinvest the proceeds from the sale into the airline rather than transferring the full amount directly to the government. They also propose issuing new appointment letters only to selected employees while suggesting that the remaining workforce be transferred to a holding company.
These issues are currently the subject of high-level discussions. The government’s concessions on these points could tip the negotiations in favour of the buyers. Additionally, the six shortlisted bidders have raised concerns regarding the terms of the proposed shareholders’ agreement and the sale and purchase agreement, which will need to be resolved in the final agreements, including the purchase, subscription, and shareholders’ agreements.
The government has shortlisted potential buyers, including Fly Jinnah, Airblue, Arif Habib Corporation, Blue World City, Pak Ethanol Private Consortium, and YB Holdings Consortium. Interestingly, two pre-qualified parties have suggested retaining the entire bid amount for reinvestment in PIA instead of paying it to the government.
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Meanwhile, one local airline has expressed willingness to acquire 100% of PIA’s shares and comply with government payments. In response, the government is considering splitting the bid price, aiming to retain some funds while reinvesting the remainder into the airline.
