Fauji Fertiliser Company joins successful consortium following PIA privatisation bid

WEB DESK: Fauji Fertiliser Company (FFC) has decided to become part of the consortium led by Arif Habib Corporation Limited, which secured the winning bid for the purchase of a 75 percent stake in Pakistan International Airlines (PIA).

Arif Habib confirmed the development, saying FFC had formally joined the consortium and that talks were ongoing to settle the terms and framework of its participation.

FFC was initially among four prospective bidders for the PIA stake but exited the race before the submission and opening of bids. Under the privatisation framework, bidders that withdraw during the process are permitted to join the successful consortium, provided they meet the eligibility requirements laid down by the Privatisation Commission.

Adviser to the Prime Minister on Privatisation Muhammad Ali welcomed FFC’s inclusion, describing it as a positive step that would bolster the consortium’s financial strength as well as its managerial capacity and international reach.

He said PIA needed a robust and well-managed ownership structure to transform into a competitive global airline, adding that FFC’s involvement would support that objective. Earlier, Ali had also described Fauji Fertiliser as a strong corporate group with proven management expertise, noting that its participation would further reinforce the buyer consortium.

PIA to be handed over by April 2026

Pakistan International Airlines (PIA) is expected to come under the management of new private owners from April 2026, subject to regulatory and cabinet approvals, Adviser to the Prime Minister on Privatisation Muhammad Ali said. A consortium led by Arif Habib Corporation won the bid for a 75 per cent stake in the national flag carrier, offering Rs135 billion, well above the government’s reserve price of Rs100bn. The sale marks a major breakthrough in Pakistan’s long-delayed efforts to privatise the loss-making airline after a failed attempt last year.

According to Ali, the transaction now requires approval from the Privatisation Commission Board and the federal cabinet, expected within days. A contract is likely to be signed within two weeks, followed by a 90-day period to meet legal and regulatory requirements before financial close. The government will receive around Rs10bn in upfront cash and retain a 25pc stake valued at about Rs45bn, while most of the bid amount will be reinvested into PIA to strengthen its finances.

Ali said the deal was designed to inject fresh capital rather than simply transfer ownership, ensuring the airline’s survival and future growth. The winning consortium includes Fatima Fertiliser, City Schools and Lake City Holdings, with scope to add further partners, including Fauji Fertiliser Company or a foreign airline, subject to criteria. Safeguards allow the government to move to the second-highest bidder if the deal fails.

The privatisation is closely watched by the IMF, which has urged Pakistan to curb losses at state-owned enterprises. Ali said completing the sale would signal reform momentum and improve fiscal credibility. Defending the transaction, he said PIA had incurred losses of Rs500bn over a decade and now operates only 18 aircraft. He stressed that privatisation would enable fleet expansion, service improvements and long-term viability, adding that “there is no pride in owning an airline that cannot fly.”