Fauji Fertilizer Company Limited (FFC) has formally expressed its interest in acquiring a stake in national flag carrier, Pakistan International Airlines Corporation Limited (PIACL), according to a disclosure sent to the Pakistan Stock Exchange (PSX) on Monday.
The FFC board approved this move in its 234th meeting held on June 13, 2025.
FFC will submit an Expression of Interest (EOI) and relevant prequalification documents to the Privatization Commission. The company also plans to undertake a comprehensive due diligence exercise regarding the transaction.
“Board of Directors of Fauji Fertilizer Company Limited (FFC) during 234th Board of Directors Meeting held on June 13, 2025 has approved submission of Expression of Interest (EOI) and prequalification documents to the Privatization Commission in relation to the potential acquisition of stakes in Pakistan International Airlines Corporation Limited, and undertaking a comprehensive due diligence exercise in this regard,” read the FFC’s disclosure.
The FFC’s move aligns with the government’s ongoing privatisation strategy for PIA, which has long been seeking strategic investors for restructuring and financial revival of one of the most loss-making public entities in the country.
Last month, the government extended the deadline for submitting Expressions of Interest (EoI) from both domestic and international investors who are interested in acquiring a majority stake in PIA, ranging from 51% to 100%. The new deadline for submissions is June 19, 2025, an extension from the original deadline of June 3, 2025. However, all other terms and conditions for the privatization process remain unchanged.
The advertisement issued by the government confirms that the deadline for submitting EoIs and Statements of Qualification for the “Divestment of Pakistan International Airlines Corporation Limited through privatization” has been extended to 16:00 hours on Thursday, June 19, 2025. The terms and conditions for the privatization process remain as initially outlined.
According to the public notice, each EoI must be accompanied by a non-refundable processing fee of $5,000 or Rs 1.4 million. In the case of consortia, only one member is required to pay the fee. Eligible bidders include legal entities such as companies, firms, and corporate bodies, either individually or as part of a consortium.
PIA is majority-owned by the government, which holds about 96% of the airline’s capital through PIA Holding Company Limited (PHCL).
A previous attempt to privatise PIA in 2024 failed after the government received just one offer from the Blue World City consortium. The bid—Rs10 billion for a 60% stake—fell far short of the Privatisation Commission’s benchmark valuation of Rs85.03 billion and was consequently rejected. The privatisation process was scrapped amid concerns over valuation gaps, transparency, and a lack of investor confidence.
Earlier, the government initiated a major corporate restructuring effort to make the airline a more viable investment. On May 3, 2024, the Securities and Exchange Commission of Pakistan (SECP) approved a scheme of arrangement (SOA), which led to the division of the airline into two separate entities: PIA and PIA Holding Company Limited (PIA Holdco).
Under the SOA, the core aviation operations—including passenger transport, cargo, engineering, flight training, ground handling, and catering—remained with PIA.
Non-core assets and legacy liabilities such as old debt and non-operational real estate were moved to PIA Holdco, now listed on the stock exchange. PIA subsequently became a wholly owned subsidiary of PIA Holdco.
According to a recent report by Profit, the restructuring of PIA is already showing signs of recovery. For the year ended December 2024, the airline posted an operating profit of approximately Rs9.4 billion and a net profit of Rs26.2 billion, with earnings per share rising to Rs5.01. This marks a sharp turnaround from 2023, when the company reported a net loss of Rs104 billion—equivalent to a loss of Rs20 per share.
The last time PIA reported an annual profit was in 2004, when it posted after-tax earnings of Rs2.3 billion. In the years that followed, the airline accumulated over Rs600 billion in losses between 2005 and 2024, reflecting a prolonged period of financial decline.
Operationally, the airline has regained some stability. Over the past financial year, it carried nearly 4 million passengers across 30 destinations, operating an average of 268 flights per week. It continues to function as a full-service carrier, supported by its auxiliary divisions such as engineering, catering, cargo, ground handling, and training.
The Privatisation Commission Board has also approved revised pre-qualification criteria to filter out speculative investors and ensure only technically competent and financially stable parties move forward in the process.
The government aims to finalise the transaction within 2025, fulfilling its fiscal reform agenda, offloading a historically loss-making public entity, and concluding a privatisation process that has lingered for nearly two decades.
