Pakistan to Sell 100% Stake in PIA with Phased Acquisition, Bidding Starts December 23

The federal government of Pakistan has finalized plans to sell its entire 100 percent stake in Pakistan International Airlines (PIA), offering a structured, phased acquisition to attract serious investors. Under the revised privatization strategy, the initial auction, scheduled for December 23, will be for a 75 percent stake in the airline. The winning bidder will then have the option to purchase the remaining 25 percent within one month at a 12 percent premium over the original bid, reflecting deferred payment terms that allow the amount to be paid one year later instead of upfront.

The payment structure has also been revised to encourage investment. Only 7.5 percent of the bid amount will need to be paid in cash, while the remaining 92.5 percent will be directly injected into PIA as equity, rather than being transferred to the national exchequer. Previously, bidders were required to pay 15 percent of the bid amount in cash, a condition that had limited interest during the earlier privatization attempt.

The government’s decision to divest the full 100 percent stake follows feedback from four shortlisted bidders, who sought complete operational control with no government interference post-transaction. Prime Minister Shehbaz Sharif had initially proposed selling a 60 percent stake, but the strategy was expanded after bidders requested majority or full ownership for streamlined decision-making.

Adviser to the Prime Minister on Privatization, Muhammad Ali, confirmed that the government approved a green shoe option, enabling the successful bidder to acquire the remaining 25 percent at a post-money valuation with a 12 percent premium. The previous attempt to privatize PIA, which offered only a 60 percent stake, failed after attracting just one serious bidder, highlighting the importance of this revised, investor-friendly structure.