Pakistan sells loss-making PIA to Arif Habib group for Rs 135 billion

Arif Habib acquires Pakistan International Airlines

Pakistan successfully completed the privatisation of its national flag-carrier on Tuesday, selling Pakistan International Airlines (PIA) for Rs 135 billion to a consortium led by local investment firm Arif Habib.

The ceremony took place in Islamabad, where all three pre-qualified bidders—Lucky Cement, private airline Airblue, and Arif Habib—submitted sealed bids into a transparent box. During the second phase of the process, bids were opened, revealing Arif Habib as the highest bidder at Rs 115 billion, followed by Lucky Cement at Rs 105.5 billion and Airblue at Rs 26.5 billion.

After the bids were announced, the government confirmed a reference price of Rs 100 billion and allowed the top two bidders to compete in an open auction. Both Arif Habib and Lucky Cement raised their offers step by step until Arif Habib submitted Rs 135 billion, which remained unchallenged.

“We congratulate Arif Habib group,” a Lucky Cement representative said while yielding to the higher bid. The government initially offered 75 per cent of the airline’s shares, with the successful bidder granted 90 days to purchase the remaining 25 per cent.

Under the privatisation rules, 92.5 per cent of proceeds from the sale of the initial 75 per cent stake will go to PIA for reinvestment, while the remaining 7.5 per cent will be transferred to the government. The investor is also required to commit Rs 80 billion in investment over the next five years. The government had previously assumed PIA’s liabilities of Rs 654 billion.

The entire bidding process was broadcast live on local television to ensure transparency. This auction marks the second attempt at privatising PIA after last year’s effort failed to meet the government’s expected price.

Earlier, Prime Minister Shehbaz Sharif thanked officials and the Privatisation Commission for their role in the process, calling it “transparent” and describing it as the “largest transaction” in Pakistan’s history.

Once a leading airline globally, PIA’s decline due to mismanagement left the government with no choice but to sell the national carrier.