ISLAMABAD: Pakistan’s Privatisation Commission on Tuesday approved the addition of Fauji Fertilizer Company (FFC) to the winning consortium acquiring a 75 percent stake in the Pakistan International Airlines, expanding the buyer group as the landmark Rs135 billion ($480m) deal heads towards its first major payment deadline in late April.
The PC Board, chaired by Privatisation Adviser Muhammad Ali, endorsed FFC’s inclusion after confirming the fertiliser giant meets all eligibility and regulatory requirements. The decision now goes to the Cabinet Committee on Privatisation for final approval.
FFC’s entry was widely anticipated. When the Arif Habib Corporation-led consortium edged out a rival Lucky Cement group in December with a winning bid of Rs135 billion, the country’s largest privatisation in two decades, Habib had publicly signaled that FFC could join at a later stage. Under the transaction framework, the consortium was permitted to nominate up to two additional members.
Arif Habib Corporation remains the lead member and majority stakeholder. The expanded consortium now includes Fatima Fertilizer, AKD Group, City Schools, Lake City Holdings and, pending cabinet sign-off, FFC.
The deal’s first closing, is in late April, requires the consortium to pay two-thirds of the bid amount, roughly Rs83.3 billion. At that stage, the group must also declare whether it intends to acquire the government’s remaining 25 percent stake, available at a 12 percent premium. The transaction, structured to inject Rs124.875 billion directly into PIA rather than the national treasury, is central to Pakistan’s IMF-backed reform agenda. The airline had been hemorrhaging roughly Rs50 billion annually before the sale.
Apart from this, the PC Board also recommended revising the commission’s fee structure to strengthen its financial sustainability and support institutional reforms.
