The Privatisation Commission on Monday announced the formal transfer of management control of Pakistan International Airlines Corporation Limited (PIACL) to the Arif Habib Corporation-led consortium, completing the privatisation process that began last year.
In a statement issued after a meeting of the restructured PIACL board, the commission said the government had achieved the first financial closing of the privatisation transaction, with management control officially handed over to the investor consortium after all conditions under the Share Purchase and Subscription Agreement (SPSA) were fulfilled.
The newly constituted board appointed Lt Gen (retd) Anwar Ali Haider, Managing Director of Fauji Foundation, as the first chairman of the privatised airline.
The Privatisation Commission credited Prime Minister Shehbaz Sharif, Deputy Prime Minister and Foreign Minister Ishaq Dar, Finance Minister Muhammad Aurangzeb, along with relevant cabinet committees and government officials, for their support and guidance throughout the process.
The commission said that since the SPSA was signed on January 29, 2026, it had worked alongside the Ministry of Defence and other government stakeholders to complete a series of complex conditions required under the agreement.
These included obtaining domestic and international regulatory approvals, securing approvals from aircraft lessors and commercial partners, implementing aviation policy reforms, completing corporate approvals, restructuring taxes linked to legacy liabilities, arranging aircraft financing, introducing governance changes, resolving tax-related matters, finalising airport infrastructure arrangements, and ensuring transaction security provided by the investor consortium.
In total, 40 conditions precedent covering regulatory, commercial, contractual, taxation, shareholder restructuring, rental and governance matters had to be completed before the transaction could move forward.
On the regulatory front, approvals and confirmations were required from several authorities, including the Pakistan Civil Aviation Authority, the Competition Commission of Pakistan for merger control, and the Pakistan Telecommunication Authority for change-of-control requirements.
Because PIACL operates international routes, approvals were also obtained from foreign aviation regulators and aviation safety authorities, including merger control clearances from Saudi Arabia and Kuwait. These approvals were necessary to ensure uninterrupted airline operations following the transfer of ownership.
Commercially, PIACL was required to secure 22 contractual consents under the SPSA from aircraft lessors, maintenance, repair and overhaul (MRO) providers, technical service companies, aviation fuel suppliers, airline partners, payment service providers and other operational counterparties.
These approvals ensured that existing commercial agreements remained valid after the ownership change and prevented any contract terminations, defaults or disruptions to airline operations. They also facilitated the release of encumbrances on company-owned aircraft, engines and leased assets.
The transaction also required approval from shareholders of both PIA Holding Company Limited (PIAHCL) and PIACL. Amendments were made to PIACL’s Articles of Association to incorporate the Shareholders’ Agreement framework, which was subsequently approved by the Securities and Exchange Commission of Pakistan (SECP). The authorised share capital was increased, and all necessary corporate actions were completed for issuing new shares.
The process further included extending the “Essential Services” notification to ensure industrial peace, uninterrupted airline operations, employee protection measures and staff retention commitments.
The Pakistan Aviation Authority’s infrastructure rental agreements for PAA-owned properties across various cities were extended for three years. Mechanisms agreed under the SPSA for paying legacy liabilities owed to the PAA and meeting bridge financing obligations were also implemented.
To address taxation matters, the government introduced a structured repayment mechanism for outstanding tax liabilities, protected PIACL from coercive recovery actions related to legacy tax issues, and incorporated agreed HS Codes into the Sales Tax Act.
Policy reforms included amendments to the National Aviation Policy covering airfare regulation, wet leasing, negative equity provisions, aircraft retirement age, and the continuation of key fiscal and operational incentives for an extended period after the transaction.
The commission said all conditions were completed within an exceptionally short timeframe while maintaining uninterrupted flight operations, preserving commercial relationships and aviation certifications, protecting employees’ interests, and ensuring continuous services for passengers.
The bidding process, held on December 23, 2025, resulted in total investment commitments of Rs180 billion by the consortium. Of this amount, Rs55 billion will be paid to the government for acquiring PIA, while Rs125 billion will be invested directly into PIACL to support its long-term transformation and revival.
Following the completion of the first financial closing, the consortium paid Rs10 billion to the government as sale proceeds and injected Rs80 billion into PIACL as fresh equity. According to the commission, the funds will strengthen the airline’s financial position, support fleet expansion and modernisation, expand its route network, and improve operational performance and customer service.
The second financial closing is scheduled within 12 months of the first closing under the SPSA. During this phase, the consortium has committed to invest an additional Rs45 billion into PIACL. It has also expressed its intention to purchase the remaining 25 per cent of PIACL shares through a call option in the SPSA for an additional Rs45 billion payable to the government.
Adviser to the Prime Minister on Privatisation Muhammad Ali said the transaction demonstrated Pakistan’s ability to complete complex strategic deals through a transparent, fair, competitive and professionally managed process. He said it reflected the government’s commitment to economic reforms, fiscal responsibility and greater private-sector participation while boosting investor confidence.
A spokesperson for PIA Equity Ltd, the special purpose vehicle (SPV) representing the winning consortium led by Arif Habib Corporation, said the consortium had secured 100 per cent private ownership of the airline through a transaction worth around Rs180 billion.
He described the partnership as an unprecedented combination of industrial, financial and institutional strength.
Under the new ownership structure, Fatima Fertiliser, owned by Arif Habib, holds the largest stake at 34.1 per cent, followed by Fauji Fertiliser with 33.9 per cent. Lake City, City Schools and AKD Group each own 16 per cent, giving the consortium full control of the national flag carrier.
Addressing the occasion, newly appointed chairman Lt Gen (retd) Anwar Ali Haider said that although the airline’s corporate structure had changed, its responsibility to the people of Pakistan remained unchanged.
“As the new ownership officially takes over today, we deeply understand that the trust of a nation isn’t simply transferred on a document. Trust is earned — mile by mile, smile by smile, year by year. We know this. And we accept the challenge wholeheartedly,” he said.
He added that while PIA was entering a new chapter under private ownership, its commitment to passengers would remain steadfast.
“PIA will continue to honour its deep-rooted heritage while building a premium, modern aviation experience. The journey ahead is a collective commitment to excellence, proving once again why we are, and always will be, Great People to Fly With,” he concluded.