Arif Habib consortium emerges victorious in PIA auction with Rs135bn bid

[Ball Blazer]

Three bids were submitted Tuesday morning for a 75% stake in Pakistan International Airlines, with the next phase of the bid starting at 3.30pm.

"The first phase of the bidding process has been completed; now the matter will go to the Privatisation Commission," said Privatisation Commission (PC) Chairman Muhammad Ali. The bids came from pre-certified bidders Lucky Cement, private airline Airblue and investment firm Arif Habib. Fauji Fertiliser and other bidders have pulled out of the auction.

The PC board will review and determine the reference price (the minimum price of sale), the exact figure of which remains confidential. Ali said that once the reference price is approved by the board, it will be forwarded to the Cabinet Committee for final approval.

After the Cabinet Committee’s approval, the federal cabinet will ratify the reference price.

If the bids exceed the reserve price, an open auction will take place; otherwise, the highest bidder will be allowed to match the price.

Once the successful bidder is identified, the bidder will have 90 days to purchase the remaining 25% of shares. The government had taken responsibility for PIA's liabilities of Rs 654 billion last year. New investors are required to commit an investment of Rs80 billion over the next five years, and of the proceeds from the sale of 75% of PIA’s shares, 92.5% will be allocated to the airline for reinvestment, while the remaining 7.5% will be transferred to the government.

The government claims that this privatisation is crucial for the airline's financial health and profitability. "No major privatisation of a national asset has taken place in the last 20 years, making this move historic for Pakistan," Ali said.

Additionally, the PC has stated that employee job security will be guaranteed for one year. The holding company will be responsible for managing pension plans and post-retirement benefits.

PIA has been a target for privatisation by previous governments. The airline has struggled with mounting debts, outdated fleets, and an inability to keep pace with the competition.

PIA privatisation enters final phase as bids are reviewed | The Express Tribune

Privatisation commission reviews reference price, auction session at 3.30pm

tribune.com.pk

 

[The Bald Eagle]

Arif Habib consortium emerges victorious in PIA auction with Rs135bn bid​

ISLAMABAD: A successful bid of Rs135bn by Arif Habib won the auction for Pakistan International Airlines Corporation Ltd (PIAC) after the process moved to an open auction round at a ceremony in Islamabad, marking the country’s first major privatisation in nearly two decades.

Initially, pre-qualified bids were submitted by Lucky Cement, private airline Airblue and investment firm Arif Habib in the morning. Airblue exited the race after the first round of bidding, with a proposition lower than the reference price of Rs100bn.

In the first round, Lucky Cement put up a bid of Rs101.5bn, Airblue Rs26.5bn, and the Arif Habib consortium bid Rs115bn, after which the reference price was announced.

Following that, a 30-minute break was taken so that the two top bidders could hold consultations. A second round was then commenced.

It began with the base bid at Rs115bn, and the minimum increment was at Rs250 million. The base price was set on the basis of the highest bid made during the first round by Arif Habib.

Both bidders engaged in a brief competition to outbid each other during the round. However, when Lucky Cement raised its bid to Rs134bn, Arif Habib countered with Rs135bn, forcing Lucky Cement to bow out and congratulate Arif Habib.

The whole process was telecast live and streamed across all TV channels as well as the respective social media handles of the government.

Adviser to the prime minister on privatisation, Muhammad Ali, will also hold a press conference after the conclusion of the bidding process.

Finance Minister Muhammad Aurangzeb, speaking at the bidding ceremony, thanked the PM‘s aide and his team for their efforts and hailed the bidding process in terms of transparency.

“It takes a lot of time and effort to get to a good place where we are today,“ he said.

“All of the bidders today are from Pakistan. I used to say that no matter which team wins, Pakistan would win.”

He lauded Pakistan‘s biggest conglomerates for “vying for the best airline” and said that the flag carrier would be led by investors and some of Pakistan’s most experienced businesspeople.

“The fact that they have stepped up is a doubtless sign that anyone who is the successful bidder will take it not only to where we were, but where we need to be in the comity of nations,” Aurangzeb added.

“We need to stop the bleeding and losses, but more importantly, our institutions need to be part of the comity of nations, and we will take them there,” he added.

Aurangzeb also expressed hope that the bidding would increase the number of local investors and, in turn, the number of foreign investors entering the country.

At the outset of the ceremony, the adviser to the prime minister on privatisation addressed the audience.

Ali hoped that PIA’s privatisation would open “paths for investment in the country”.

“I would also like to thank all bidders who are present today, and those who were part of the bidding process but did not reach the final round. We wouldn‘t have been here without them, and this process wouldn’t have been completed,” he said.

“We actively engaged with all the bidders. Two of them demanded to take up to 75 per cent at least, and the other two demanded 100pc,“ he said.

“We wanted a multitude of bidders so the process of bidding would be transparent and competitive,” he continued.

He said that the government had “decided to sell at least 75pc of shares, and simultaneously, we also decided to offer the other 25pc”.

“Bidders will have the right to consider and let the government know if they also want to buy the other 25pc in the next 90 days,” he said.

He further said, “The transaction would be from 75pc up to 100pc; however, 75pc of them will be made available for sale today”.

“The government wanted to structure this transaction so it would also get a fair share and investment to be made,” he said, adding that the government did not just want to sell PIA but “to bring the national airline back to the glory it enjoyed in the past”.

He stressed the need for bringing in “new investment, buy new carriers and repair the engine, cut the liabilities, pay the employees on time”.

“If we want to expand the fleet from 18 planes to 30-40 or more, then investment is the only way,” he added.

In the morning, representatives of the bidding groups had walked in one by one to deposit sealed offers into a transparent box, briefly fumbling as they pushed envelopes through the slot in a separate public ceremony in Islamabad that was also broadcast on state television.

Following that, the reference price for PIACL’s bidding was approved by the Privatisation Commission Board and the Cabinet Committee on Privatisation after bids were received.

Meanwhile, speaking to the media, Ali said, “God willing, we will get a good bid, there will be good investment, and we will succeed.“

The auction was Pakistan’s second attempt at selling the once storied flag carrier after televised bidding last year collapsed when a solitary offer fell far below the government‘s reference price, derailing what would have been the country’s first major privatisation in nearly two decades.

Meanwhile, Prime Minister Shehbaz Sharif, while addressing a meeting of the federal cabinet, thanked government officials and the Privatisation Commission for their role in the national carrier’s privatisation.

He stressed that the process has been made “transparent“, stating that it will be the “largest transaction” ever in Pakistan’s history.

“Today, as the bidding starts [..] the bids will come in sealed envelopes, there will be transparent boxes, there will be a live telecast. When the price is determined, the envelopes will be opened. They will compete, and whoever has the highest bid will [succeed],“ he said.

“Only God knows how high the bid will go, but the process must come back to the cabinet,” he said.

Earlier, Ali said the two unsuccessful bidders will be excluded from any future role in the airline’s management thanks to a unique stipulation.

In recent remarks, he explained that losing bidders will have no right to join the winning bidder, and only those groups who were not party to the auction would be able to join the new management.

This means that while only one of the three consortiums currently in the running for the flag carrier will become part of its administration upon acquisition of a majority stake, Fauji Fertiliser Company Ltd retains the option to join with them subsequently, if it wishes to.

The company was previously in the race for PIA but then decided to quit the bidding process.

Ahead of Tuesday’s bidding, reports surfaced of a behind-the-scenes deal involving at least two of the parties involved — the Arif Habib and Lucky Cement groups — that reportedly fell through.

In a tweet, journalist Kamran Khan alluded to a meeting where it was proposed to split the controlling stake among three of the four interested parties. However, Khan claimed, this arrangement fell through as one of the parties — i.e. the Muhammad Ali Tabba-led Lucky Cement group — did not agree to it.

Both Tabba and a high-ranking government official privy to developments confirmed this, but clarified that this was not a government-brokered meeting, but rather an informal interaction.

Talking to Dawn, Tabba expressed unwavering confidence in the privatisation process, and clarified that the proposal was floated to him after a meeting in Islamabad, which he did not pursue.

Dawn News

 

[Cricket Warrior]

Arif Habib welcomes Fauji Fertilizer as partner in PIA revival

Following the successful acquisition of Pakistan International Airlines (PIA), the Arif Habib Consortium has confirmed the inclusion of Fauji Fertilizer Company as a partner in the deal, ARY News reported.

Speaking about the partnership, representatives of the Arif Habib Group welcomed Fauji Fertilizer’s participation, emphasizing the positive impact it would bring to the airline’s revival.

The consortium plans to invest Rs125 billion in PIA over the next year, aiming to modernize operations and expand the airline’s fleet from 18 to 62 aircraft. Arif Habib officials also highlighted plans to provide PIA employees with better platforms and opportunities while ensuring enhanced travel facilities for passengers.

“Improving passenger experience and offering a strong operational platform for employees will be our top priorities,” said the Arif Habib Group. The partnership is expected to accelerate PIA’s restructuring and restore it as Pakistan’s flagship carrier.

Arif Habib welcomes Fauji Fertilizer as partner in PIA revival

Explore the Arif Habib partnership with Fauji Fertilizer to revitalize the PIA through significant investments and upgrades.

arynews.tv

 

[Wasim Ghulam]

So Bid is 135 Billion and govt only gets 10 Billion out of it. wow

rest of the 92.5 % goes into same company whose 75% stake has been sold out which means actual value Govt Gets is 10 Billion initial payment plus 25% of 125 Billion re invested which is roughly 31 Billion.

PIA's Laibilities stay with govt which means buyer is nt taking on any negative Equity infact Buyer gets whole fleet of PIA and its Routes for Roughly 50 Billion Rs while Deprecaited assets of PIA in its balance sheet are worth 150 billion plus. Remember its deprecaited value shown in balance sheet , not actual market value which is considered to be higher usually when acquisitions happen

 

[Cricket Warrior]

Arif Habib promises major investments, fleet expansion for PIA

Arif Habib has outlined ambitious plans for the revival of Pakistan International Airlines (PIA), following his group-led consortium’s successful acquisition of a 75 percent stake in the national carrier.

Speaking about the development, Arif Habib said the achievement is “a success for the entire nation, the government, and all PIA passengers.” He revealed that 92 percent of the Rs135 billion bid will be spent directly on the airline, with approximately Rs125 billion allocated for company development over the next year.

He detailed plans to modernize old aircraft, introduce new planes, improve maintenance and services, and expand PIA’s operational fleet from 18 to 62 aircraft. Improving passenger experience and providing high-quality service are his top priorities. “We will do everything possible to provide the best services to PIA passengers,” he said.

Arif Habib also emphasized the importance of PIA employees, describing them as highly capable and promising to provide them with a strong platform. “We hope PIA staff will showcase their skills and continue to bring pride to Pakistan,” he added.

He further noted that the privatization will encourage investment in Pakistan, mentioning that the Lucky Cement Consortium, which placed a final bid of Rs134 billion, will also have opportunities for future investment in the country.

Overall, Arif Habib’s plan aims to restore PIA’s legacy, enhance Pakistan’s aviation sector, and position the airline as a leading carrier in the region.

Arif Habib promises major investments, fleet expansion for PIA

Arif Habib plans to revive Pakistan International Airlines (PIA) with significant investments aimed at modernizing the fleet and services.

arynews.tv

 

[Wasim Ghulam]

Arif Habib promises major investments, fleet expansion for PIA

Arif Habib has outlined ambitious plans for the revival of Pakistan International Airlines (PIA), following his group-led consortium’s successful acquisition of a 75 percent stake in the national carrier.

Speaking about the development, Arif Habib said the achievement is “a success for the entire nation, the government, and all PIA passengers.” He revealed that 92 percent of the Rs135 billion bid will be spent directly on the airline, with approximately Rs125 billion allocated for company development over the next year.

He detailed plans to modernize old aircraft, introduce new planes, improve maintenance and services, and expand PIA’s operational fleet from 18 to 62 aircraft. Improving passenger experience and providing high-quality service are his top priorities. “We will do everything possible to provide the best services to PIA passengers,” he said.

Arif Habib also emphasized the importance of PIA employees, describing them as highly capable and promising to provide them with a strong platform. “We hope PIA staff will showcase their skills and continue to bring pride to Pakistan,” he added.

He further noted that the privatization will encourage investment in Pakistan, mentioning that the Lucky Cement Consortium, which placed a final bid of Rs134 billion, will also have opportunities for future investment in the country.

Overall, Arif Habib’s plan aims to restore PIA’s legacy, enhance Pakistan’s aviation sector, and position the airline as a leading carrier in the region.

Arif Habib promises major investments, fleet expansion for PIA

Arif Habib plans to revive Pakistan International Airlines (PIA) with significant investments aimed at modernizing the fleet and services.

arynews.tv

When you sold 75% company to private entity , how would that 125 Billion Re invested will elevate Pakistan's awam? it will definitely elevate seth sahib