A Canadian-Pakistani business consortium Al-Nihang, led by Pakistani expatriate Faqir Muhammad M Ali, proposed a substantial investment of around Rs100 billion ($358 million) to acquire Pakistan International Airlines (PIA), on November 3.
The offer, aiming to revive the financially struggling national carrier, was detailed in a letter from the Al-Nihang’s Group and sent to key Pakistani government bodies, including the ministries of aviation, defense, and privatization, as well as the Planning Commission and the Establishment Division.
Al-Nihang’s CEO Faqir Muhammad M Ali, in the letter, emphasized the group’s commitment to acquiring full ownership of PIA under the terms outlined in the government’s tender proposal, pledging comprehensive management of the carrier.
“I am writing to formally present an offer to acquire PIA at a valuation of PKR 100 billion in recognition of its invaluable role as Pakistan’s national carrier,” Ali said.
Commitment to growth and international business
The proposal includes assuming PIA’s extensive liabilities, estimated at Rs250 billion ($896 million), and guarantees the retention of current employees for 2-3 years, with continued payment of salaries and benefits.
Additionally, the consortium’s plan outlines a strategic focus on bolstering the airline’s operational capabilities, engineering and technical services, exclusive cargo operations, and aviation training, which are expected to attract foreign business and partnerships.
Highlighting Al-Nihang’s commitment to PIA’s transformation, Faqir’s proposal envisions expanding the carrier’s fleet and strengthening passenger, cargo, and engineering services to enhance competitiveness.
“By fully utilizing these strengths, we aim to significantly boost foreign exchange inflows, contribute to Pakistan’s economic growth, and foster an environment that attracts international business and partnerships,” the group stated.
Currently, Pakistani authorities have not publicly responded to the proposal, which also includes a readiness to satisfy all due diligence requirements immediately.
Proposal amidst government’s privatization efforts
The proposal follows Pakistan’s recent attempt to privatize PIA as part of a $7 billion IMF program aimed at reforming state-owned enterprises. The government’s plan to sell a 51-100% stake in PIA to raise funds encountered challenges after the final bidding round received only a single bid of Rs10 billion ($36 million), well below the minimum valuation.