Lahore, April 10: Pakistan is making a fresh attempt to privatize Pakistan International Airlines (PIA) after last year’s efforts failed to attract competitive bids.
The government, now armed with revised financials and better investor incentives, plans to publish a new Expression of Interest (EoI) by the end of April 2025.
With legacy debts cleared and financial hurdles addressed, Islamabad is hoping to successfully offload a 51-100% stake in the struggling national carrier this time around.
The move is part of a broader push under the $7 billion IMF-backed economic reform program aimed at restructuring loss-making state-owned enterprises (SOEs).
Why the First Attempt Failed
In 2024, Pakistan’s privatization attempt collapsed when the only offer received was well below the $300 million asking price. Potential investors had raised concerns about PIA’s massive debt, taxation issues, and an unbalanced financial sheet—all of which have now been addressed.
Read more: Transaction Arrangement of PIA Privatization Recommended to CCOP
To make the deal more attractive, the government has cleared PIA’s legacy debts by shifting them to state accounts. It has also resolved taxation and financial reporting issues that previously discouraged bidders. Pre-qualification criteria have also been revised to attract a broader range of investors. The government has also reassessed the airline’s valuation, ensuring a more realistic reference price.
According to Muhammad Ali, the government adviser on privatization, these changes are expected to draw stronger interest when bidding reopens later this month.
PIA Sale Part of Pakistan’s Larger Privatization Drive
The push to privatize PIA is part of Pakistan’s broader effort to offload inefficient SOEs. Prime Minister Shehbaz Sharif has emphasized that selling nonperforming enterprises is essential for economic stability and long-term fiscal health.
As part of this drive, the privatization of power distribution companies has also been fast-tracked. Companies that were originally set for later sales have now been moved into the first phase to generate quick revenue and improve Pakistan’s overall financial position.
Read more: PIA Reports First Net Profit in Over Two Decades, Major Turnaround
Roosevelt Hotel: A High-Value Asset Up for Sale
Another key asset on the government’s privatization radar is PIA’s Roosevelt Hotel in Manhattan, New York. Instead of a direct sale, the government has appointed Jones Lang LaSalle (JLL) to explore various sale strategies, including a direct building sale, providing immediate liquidity. There are also plans for a joint venture with a top-tier developer, which could generate up to five times more revenue than a simple sale.
The Roosevelt Hotel, long considered a financial burden, could now turn into one of Pakistan’s most profitable assets under the right strategy.
With financial reforms in place and investor concerns addressed, Pakistan is making a second attempt to privatize PIA—this time with better chances of success. The revised bidding process, along with the broader privatization of power companies and key assets like Roosevelt Hotel, reflects Pakistan’s commitment to economic revival and fiscal discipline.
With the new EoI set to be published by April 2025, all eyes are on whether the changes will attract serious investors this time around.
