Arif Habib consortium wins PIA auction bid at Rs 135bn
Aurangzeb hopes PIA sale will bring investment
ISLAMABAD: A successful bid of Rs 135bn by Arif Habib won the auction for Pakistan International Airlines Corporation Ltd (PIAC) after the process moved to an open auction round, 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, with a bid lower than the reference price of Rs100bn.
In the first round, Lucky Cement put up a bid of Rs 101.5bn, 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 Rs 250 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 Rs 134bn, Arif Habib countered with Rs 135bn, 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.
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.
“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. Staff Report
