PIA Holding Company Formation Approved by Federal Cabinet

[Abbas Ali]

On March 20, federal cabinet meeting chaired by Prime Minister Shehbaz Sharif approved establishment of Pakistan International Airlines (PIA) Holding Company as a step towards privatization of the loss-making airline.

PIA’s PKR 825 billion liabilities would be parked in the holding company to offer the airline without liabilities for privatization.

Abbas

[Abbas Ali]

According to the The Gazette of Pakistan notification issued on March 20, 2024:

Federal Government of Pakistan has approved incorporation of a company namely 'PIA Holding Company Limited' to be wholly owned by the Government of Pakistan with authorized capital of PKR 53.5 billion.

Chief Executive Officer (CEO) of Pakistan International Airlines Corporation Limited (PIACL) Air Vice Marshal Amir Hayat has been appointed as the first CEO of PIA Holding Company Limited.

Secretary Aviation, Secretary Finance and Secretary Privatization Division have been nominated as promoters, subscribers and first directors each holding one share in the newly formed company. They shall carry out necessary formalities to incorporate the company.

In terms of 7th Schedule of the Companies Act - 2017, the company is hereby exempted from payment of fee for Authorized Capital from time to time.



Abbas

[arshad.altaf]

Will forming this holding company expedite the privatization process?

Regards,
Arshad

[Abbas Ali]

On March 26, Pakistan's Federal Cabinet approved 11-member board of PIA Holding Company Limited.

Former Governor State Bank of Pakistan (SBP) Tariq Bajwa has been appointed as the chairman of the board. The 11-member board will include 7 independent directors and 4 government officers.

Majority of independent directors are heads of commercial banks including President & CEO Bank Alfalah Atif Aslam Bajwa and President & CEO of United Bank Limited (UBL) Shazad Dada.

Government officers on the board include secretaries Aviation, Finance, Privatization and Planning Commission.

PIA liabilities and assets will be transferred to PIA Holding Company.

Abbas

[Abbas Ali]

The first meeting of PIA Holding Company Limited board of directors on March 27, 2024, endorsed the Scheme of Arrangement (SOA) delineating the pathway for the privatization of Pakistan International Airlines (PIA). This comprehensive scheme, already receiving the stamp of approval from both the Federal Cabinet and the Pakistan International Airlines Corporation Limited (PIACL) Board, sets the stage for the next chapter of the airline.

Additionally, the board meticulously deliberated on various strategic facets of the business, thereby laying down the groundwork for the efficient functioning of the holding company.

Abbas