Pakistani-led Canadian group Al-Nihang offers $358m to acquire PIA

A business group in Canada led by a Pakistani expat has offered the Pakistan government around Rs100b ($358m) to acquire its debt-ridden national carrier, Pakistan International Airlines (PIA), a letter written by the group’s CEO earlier this month shows. Cash-strapped Pakistan was looking to offload a 51-100% stake in debt-ridden PIA to raise funds and reform state-owned enterprises as envisaged under a $7b International Monetary Fund program. The process, however, hit a snag last month when the final bidding round attracted just one bid of Rs10b ($36m) for a 60% stake in the national flag carrier. The offer letter by the Al-Nihang’s Group, dated Nov. 3, has been sent to the ministries of aviation, defense and privatization as well as the Establishment Division and the Planning Commission. “I am writing to formally present an offer to acquire PIA at a valuation of PKR 100b in recognition of its invaluable role as Pakistan’s national carrier,” Al-Nihang’s CEO Faqir Muhammad M Ali said in the letter. “Al-Nihang’s Group will acquire the full shareholding of PIA in accordance with the terms outlined in the tender proposal, assuming comprehensive ownership.” Among proposed acquisition conditions, the group will be responsible for PIA’s existing liabilities, amounting to approximately Rs250b ($896m), and ensure all outstanding payments. It would also retain all current PIA employees for a period of 2-3 years and commit to continue paying salaries and benefits.<br/>There has been no comment as yet from Pakistani authorities regarding the offer.<br/>