PIA to split into two units as cabinet approves privatization

February 06, 2024 (MLN): The federal cabinet has approved the restructuring of Pakistan International Airlines (PIA) on the recommendation of the Privatization Commission.

Taking into account international examples, a financial restructuring plan for PIA has been devised whereby PIA will be divided into two companies, TopCo and HoldCo.

The first unit will handle operations, engineering, ground operations, cargo, flight kitchen, and training.

Meanwhile, the Precision Engineering Complex, PIA Investment Ltd, and other operations will be under the second holding company.

To note, PIA had been facing losses for many years. The company had liabilities of Rs785bn ($2.81bn) and accumulated losses of Rs713bn as of June last year. Its CEO has said losses in 2023 were likely to be Rs112bn.

These measures will help attract capital investors to PIA.

The Federal cabinet has also approved privatization of First Women Bank Limited (FWBL).

The Government of Pakistan owned the majority shareholding (82.64%) in the bank, while the remaining shares are held by the five major commercial banks, namely NBP, HBL, MCB, UBL, and ABL.

Copyright Mettis Link News