The government has assured the International Monetary Fund (IMF) that it will privatise Pakistan International Airlines (PIA) by July 2025, while the future of the Roosevelt Hotel in New York remains undecided following the premature termination of a $228 million lease agreement by the New York City government.
According to a report by The Express Tribune, the Cabinet Committee on Privatisation (CCOP) is yet to decide whether to sell Roosevelt Hotel outright or offer it under a joint lease agreement.
The PIA-owned property, located in one of the world’s most expensive real estate markets, was leased to the New York City government in July 2023 for use as an immigrant housing facility. However, the city has now given notice to terminate the lease a year early, potentially causing an $80 million revenue loss. The government is now considering alternative business options for the property.
Despite hiring Jones Lang LaSalle Americas as a financial advisor for the Roosevelt Hotel at a cost of Rs2.1 billion, the government has yet to finalise a privatisation strategy. A special committee, led by Federal Minister for Petroleum Ali Pervaiz Malik, has recommended selling the hotel through open bidding after Saudi Arabia declined formal interest. However, the CCOP has yet to review the report.
During a briefing to the IMF, federal authorities outlined plans to privatise five to seven state-owned enterprises (SOEs), including PIA, three financial institutions, and three power distribution companies. Among the financial institutions, the Zarai Taraqiati Bank Limited (ZTBL) is expected to be privatised by November 2025.
Regarding PIA’s privatisation, authorities informed the IMF that an Expression of Interest (EOI) will be issued by the end of March 2025. The government is assessing market sentiment before moving forward, following an earlier failed privatisation attempt where a real estate developer was the sole bidder, offering Rs10 billion—far below the minimum Rs85 billion valuation. The IMF has agreed to relax key conditions, including waiving the 18% sales tax on aircraft leases and adjusting Rs45 billion in liabilities, to improve investor interest.
In the power sector, the government plans to sell three power distribution companies—Faisalabad, Islamabad, and Gujranwala Electric Supply Companies—by December 2025.
However, a final decision on whether to sell them together or separately will be based on recommendations from the financial advisor. The IMF inquired about outstanding commercial debt on these companies, but the government clarified that no power generation company would be sold this year.
The privatisation of financial institutions is also underway. The United Arab Emirates (UAE) has shown interest in acquiring First Women Bank Limited as a full commercial bank, with the deal expected to close by May 2025. However, the UAE prefers a government-to-government transaction rather than participating in an open bidding process.
Meanwhile, the government is hiring a financial advisor for the ZTBL privatisation, aiming for a sale by November 2025. Additionally, authorities expect to finalize the sale of House Building Finance Company next month, after multiple missed deadlines in previous attempts.
