Blue World City sole group to submit bid as PIA privatisation process gets under way

The bidding process for the privatisation of flag carrier Pakistan International Airlines (PIA) got under way at the Serena Hotel on Thursday with the Privatisation Commission confirming to Business Recorder that one bidder – consortium of real estate group Blue World City – submitted the lone bid.

The bids were to be submitted at 1:30pm. Other groups stayed away from depositing the ‘earnest money’, and hence, were also not eligible to submit a bid.

The lone bid is due to be opened at 6:30pm.

The entire privatisation process will strictly adhere to regulatory guidelines and legal requirements, reported Business Recorder earlier.

However, new conditions from potential buyers surfaced, particularly, concerning the airline’s employees.

A total of six groups had earlier been shortlisted to bid for shares in PIA including Airblue Ltd., Arif Habib Corporation Ltd., Air Arabia’s Fly Jinnah, Y.B. Holdings Pvt., Pak Ethanol Pvt. and real estate consortium Blue World City.

However, Bloomberg on Tuesday reported that the government received interest from only one group out of a total of six for a stake in the national carrier as other consortiums stayed away from one of the country’s major privatisation attempts.

It was confirmed on Wednesday that Blue World City was the sole bidder for a stake in the country’s flag carrier.

Saad Nazir, Chairman of Blue World City, confirmed to Reuters in a text message that his company is the only one to enter the final bidding process, though he declined to disclose the earnest money it had submitted.

Market sources indicated that the earnest money amount was Rs500 million.

Pakistan aims to privatise flag carrier PIA in November: finance minister

Blue World City has a consortium that includes Blue World Aviation and IRIS Communication Limited. The group is also looking into acquiring operations of the Islamabad International Airport which the government is looking to outsource.

Islamabad has previously said it was putting on the block a stake of between 51% and 100% in the debt-ridden airline as part of reforms urged by the International Monetary Fund (IMF) with which it has an ongoing 37-month, $7-billion bailout.

However, after much delay, during a time when potential bidders raised several concerns over various features of the privatisation, the process will take place amid strict scrutiny.