PIA buyers reject government’s major conditions

Islamabad: Prospective buyers of Pakistan International Airlines (PIA) have refused to accept the significant conditions imposed by the government.

According to sources, the bidders are unwilling to commit to an investment of $500 million in PIA, increase the fleet size, or continue operations on specific domestic and international routes.

Instead of transferring the entire sale amount to the government, the potential buyers have proposed reinvesting it into the airline.

Additionally, the bidders want to issue new appointment letters to employees they choose to retain, while demanding that the remaining employees be transferred to a holding company.

Sources indicate that the matter is now being discussed at a high level. If the government agrees to these demands, the balance of power may shift in favor of the PIA buyers.

The six shortlisted bidders have also expressed concerns about the proposed shareholders’ agreement and the sale-purchase agreement.

The purchase agreement, subscription agreement, and shareholders’ agreement will need to be signed between the successful buyer and the government.

The government has shortlisted Fly Jinnah, Airblue, Arif Habib Corporation, Blue World City, Pak Ethanol Private Consortium, and YB Holdings Consortium.

Sources further report that two pre-qualified parties have suggested retaining the entire bidding amount for investment in PIA rather than transferring it to the government, while a local airline has shown interest in acquiring 100% of PIA’s shares and is willing to pay the government.

The government has proposed splitting the bid price into two parts: retaining some of the money and investing the rest in PIA.

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