PIA hotel at Manhattan up for sale

[PK777]

PIA hotel at Manhattan up for sale

By Masood Anwar

KARACHI: The approval for the sale of famous Roosevelt Hotel by the federal government has given another ray of hope to the national flag carrier Pakistan International Airlines (PIA) to turn its account in the black this year.

The federal government last week approved the plan to sell the famous 16-storey Roosevelt Hotel, situated at Manhattan, New York. Following the green signal from the federal government, the PIA management has constituted an evaluation committee headed by Senior Vice President Finance Arif Majeed. The team will visit New York to evaluate the real market value of the Hotel.

The Hotel is owned by PIA Investment Limited (PIAIL), a subsidiary of the PIA. The PIAIL is an independent body that is running businesses other than aviation. National flag carrier PIA has a 50 per cent share in the PIAIL while a Saudi prince owns the remaining 50 per cent shares.

Beside Roosevelt Hotel, the PIAIL owns three other hotels in Paris, Riyadh and Abu Dhabi. The Saudi partner has agreed to offload his share at the price of $74 million from PIAIL, high-placed sources in the Ministry of Defence told The News. The federal government has accepted the offer price of the Saudi partner, they said.

To pay the offer price to the Saudi partner, the PIA will manage the finances from banks that will be paid later after the sale of the Hotel, they added. Following the payment to the Saudi partner, the PIA will become the solo owner of the PIAIL.

According to the PIA fund managers, PIA is expecting to fetch around $500 million from the sale of the Hotel. It is a good price, they said and added that it is enough to put PIA accounts in the black from the red.

The PIA officials are expecting that the entire sale procedure will be completed within a span of four to five months. Scribe Hotel in Paris is also on the sale list, sources said. Having 237 rooms, Scribe Hotel is the only four-star hotel located in Opera area. The PIAIL took the hotel on rent in 1980. Later, it acquired the ownership of the premises.

It has been decided in principle to dispose of all the hotels, sources said. It is the thrust of the federal government that the PIA should concentrate on its core activity that is aviation, they said. That's why all the hotels are placed on the sale list, they said. The PIA officials termed it a good decision and said that it will help inject new blood into the PIA finances.

Copyright JANG -The News