Business Desk 
Jan 10, 2025
The government of Pakistan has decided to rehire Ernst & Young (E&Y) for a second attempt at selling Pakistan International Airlines (PIA) on Friday.
This decision comes two months after Federal Minister for Privatisation Abdul Aleem Khan criticised the firm for its performance in the first privatisation attempt.
E&Y back on board for PIA privatisation
In a briefing to the National Assembly Standing Committee on Privatisation, Secretary Privatisation Usman Bajwa announced the decision to re-engage E&Y. He also mentioned that a new advertisement would soon be released to invite parties to participate in the privatisation process.
However, this step marks a change from the privatisation minister’s earlier statement in November 2024, where he expressed dissatisfaction with E&Y’s performance. The government has hired E&Y at a cost of nearly Rs2 billion, with only 27% of the price to be paid after bidding.
The first privatisation attempt failed in October 2024 when a single bidder offered Rs10bn against a reserve price of Rs85.03bn. No foreign companies showed interest, and bidders raised concerns about high taxes and liabilities.
Bajwa shared that PIA's privatisation prospects have improved after reopening European routes and securing International Monetary Fund (IMF) support. The IMF has agreed to waive aircraft lease taxes and park Rs45bn in a holding company to boost PIA’s market value.
The government plans to issue a fresh expression of interest to attract bidders. Earlier, two serious bidders walked away due to unmet demands, including one asking for full management control without share ownership.
Furthermore, the committee also reviewed the privatisation of the Roosevelt Hotel in New York and the House Building Finance Corporation (HBFC). While options for the Roosevelt Hotel include a sale, joint venture, or long-term lease, HBFC has attracted only one bidder, raising questions about the privatisation process.
