Karachi, Pakistan International Airlines Corp (PIAA) has moved closer to privatization following a decisive Extraordinary General Meeting (EOGM) that approved the company's restructuring into two distinct segments. This reorganization is integral to the government's strategy to attract foreign investment by selling a majority stake of more than 51% from its current 96% holding.

According to JS Global, the restructuring will establish PIAA as a holding company, PIA Holding Company Limited (Holdco), which will manage both the Core and Non-Core Undertakings. The transformation is part of a broader privatization effort, which began in September 2023 under the guidance of Fawad Hasan Fawad, Federal Minister for Privatization. This move is aligned with recommendations from the IMF to privatize state-owned enterprises to improve financial efficiency and reduce fiscal burdens.

The privatization timeline anticipates completion of the restructuring by July-August 2024, influenced by the company's responses to recent Expressions of Interest and pending regulatory approvals. Financially, PIA is finalizing its 2023 audits, maintaining stable debt levels since September 2023. The restructuring has also facilitated debt reprofiling approved at an estimated 12% interest rate, expected to bolster PIA Core's performance and aid in Holdco's debt repayment.

On the operational front, PIA expects to resume flights to Europe in June 2024, which should help recover significant revenue losses estimated at Rs70 billion annually. Plans are also underway to introduce 20-25 weekly flights to Paris and a city in the UK, enhancing the airline's global connectivity.