ISLAMABAD: The Privatization Commission is in the process of re-engaging the services of the consortium of financial advisers on the same terms and conditions to proceed ahead with the privatization of Pakistan International Airlines Corporation (PIAC).
The service agreement of the advisers had expired early October 2017. The commission appointed the consortium of Dubai Islamic Bank, IATA Consulting, Deloitte, HaidermotaBNR, Freshfields Bruckhaus, Deringer, Abacus Consulting, APCO, and Prestige as advisers for the transaction.
On Wednesday, Privatization Minister Daniyal Aziz briefed the National Assembly Standing Committee on Privatization that the procedural steps and the recommendations made by the financial advisers and the steps taken so far by his ministry concerning the national carrier’s sell-off.
He apprised the committee of the restructuring plan of PIACL through which PIA’s investment, hotel and real estate would be segregated from the aviation, engineering, landing and handling, healthcare and flight kitchen. He also informed the members about the core and non-core liabilities of PIACL and modes to implement the segregations.
The financial advisers have prepared a draft scheme of arrangements for transfer of specified assets into a new entity as well as its draft memorandum of association and draft articles of association for incorporation. PIACL and the Aviation Division are to affect the segregation.
The Privatization Commission, along with the consortium, has prepared a draft restructuring and implementation plan, which involves carving out of non-essential business segments of PIACL including hotels, real estate, precision engineering and legacy financing including debt like liabilities.
The transaction is envisaged to be carried out in two phases; the first entails the formulation of restructuring and divestment strategy and its implementation, while the second involves facilitating private sector partnership in the core operations of PIAC, leading to the successful closure of the transaction.
About the Utility Stores Corporation, Mr. Aziz said that it is not in the preferred list of entities and will be tackled after thorough deliberations and extensive meetings with the bodies concerned.