Govt completes first phase of PIA privatisation

Privatisation commission describes development as a major milestone in the government's economic reform programme and said it reflects its commitment to a transparent, competitive and investor-friendly privatisation process aimed at strengthening private-sector participation in the economy

ISLAMABAD: (UrduPoint/UrduPoint / Pakistan Point News-June 29th, 2026) The Privatisation Commission on Monday completed the first closing of the privatisation of Pakistan International Airlines Corporation Limited (PIACL), formally transferring the airline's management control to an investor consortium led by Arif Habib Corporation Limited after all conditions under the Share Purchase and Subscription Agreement (SPSA) were fulfilled.

In a statement, the commission described the development as a major milestone in the government's economic reform programme and said it reflects its commitment to a transparent, competitive and investor-friendly privatisation process aimed at strengthening private-sector participation in the economy.

The consortium had emerged as the successful bidder during the privatisation process held on December 23, 2025, committing a total investment of Rs180 billion. Under the agreement, Rs55 billion will be paid to the government for the acquisition of PIACL, while Rs125 billion will be injected into the airline to support its long-term restructuring and revival.

As part of the first closing, the consortium paid Rs10 billion to the government as sale proceeds and invested Rs80 billion into PIACL as fresh equity. The funds are intended to strengthen the airline's financial position, modernise and expand its fleet, increase its route network, improve operational efficiency and enhance customer services.

The second closing is scheduled within 12 months, during which the consortium will inject an additional Rs45 billion into the airline. The investor group has also exercised its intention under the SPSA to acquire the remaining 25 per cent stake in PIACL by paying an additional Rs45 billion to the government.

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The Privatisation Commission said a series of complex pre-closing requirements had been completed since the agreement was signed on January 29, 2026. These included obtaining domestic and international regulatory approvals, securing aircraft financing arrangements, implementing aviation policy reforms, restructuring legacy tax liabilities, completing corporate governance measures and fulfilling various commercial and legal obligations.

According to the commission, all conditions were completed within a compressed timeframe while ensuring uninterrupted airline operations, maintaining regulatory certifications, preserving commercial relationships and protecting employees' interests throughout the transition.

Speaking on the occasion, Adviser to the Prime Minister on Privatisation Muhammad Ali said the transaction demonstrates Pakistan's ability to successfully execute complex strategic privatisation deals through a transparent and competitive process. He said the successful first closing reinforces the government's commitment to economic reforms, fiscal discipline and increased private-sector participation while strengthening investor confidence.

He added that the government remains committed to protecting the interests of employees, passengers and consumers, while ensuring uninterrupted airline operations and continued compliance with all applicable aviation laws and regulatory requirements.

The Privatisation Commission also acknowledged the support of the Federal cabinet, the Cabinet Committee on Privatisation, the Privatisation Commission board, the Ministries of Defence and Finance, regulatory authorities and the financial advisory consortium for their role in completing the first phase of the transaction.