Pakistan to Relaunch PIA Privatization After Airline Reports First Profit in Over 20 Years
The Government of Pakistan is gearing up to relaunch the privatization of Pakistan International Airlines (PIA) later this month, following the national carrier’s first annual profit in over two decades, according to Muhammad Ali, Adviser to the Prime Minister on Privatization.
This move marks a renewed push under Pakistan’s broader economic reform agenda to divest loss-making state-owned enterprises (SOEs), a key condition under the ongoing $7 billion IMF program.
📌 Why the Previous Attempt Failed
In 2024, Pakistan received only one offer during its first privatization attempt — a bid well below the $300 million reference price.
Major issues raised by potential investors included:
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Taxation complexities
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PIA’s heavily burdened balance sheet
✅ What’s Different This Time?
To make the asset more attractive:
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PIA’s legacy debt has now been transferred to the government’s books
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Balance sheet and taxation concerns have been resolved
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Pre-qualification criteria are being revised
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The reference price may be adjusted to reflect PIA’s improved financials
“We plan to publish the new Expression of Interest (EoI) by the last week of April 2025,” said Ali, noting the deal is expected to close before year-end.
📈 PIA’s Turnaround
For the first time in over 20 years, PIA reported an annual profit — a key milestone in boosting investor confidence and reviving interest in the struggling airline.
This improved financial footing has opened the door to:
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A potentially higher valuation
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Stronger investor interest from aviation and private equity sectors
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Increased public support for the sale
🏢 Spotlight on Roosevelt Hotel, New York
Another major asset on the block is PIA’s Roosevelt Hotel in Manhattan, a prime real estate property that’s long been part of privatization discussions.
The government has appointed Jones Lang LaSalle (JLL) to explore:
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A direct sale of the building
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A joint venture with a top-tier developer — potentially offering returns five times higher than a direct sale
🔌 More SOEs Coming Up for Sale
PIA isn’t the only asset on the privatization list. The adviser confirmed that:
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The process to privatize power distribution companies has begun
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Certain companies, initially scheduled for Phase Two, are being moved up to Phase One
“Privatization of DISCOs is now a high-priority transaction,” Ali emphasized.
📉 Why Privatization Matters
Pakistan is racing against time to:
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Meet fiscal targets
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Reduce its SOE subsidy burden
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Boost foreign direct investment (FDI)
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Strengthen macroeconomic stability under IMF conditions
With elections behind them and a renewed mandate to push reforms, the government’s latest steps could finally set the stage for a successful PIA privatization — and unlock a wave of economic transformation.
