Financial advisor outlines path to short and long-term success for PIA

WEB DESK: Earnest & Young, the designated financial advisor overseeing the divestment of Pakistan International Airlines (PIA), presented a comprehensive business plan on Thursday.

This plan, discussed during a meeting with the Caretaker Federal Minister for Privatisation, Fawad Hasan Fawad, outlines a strategic investment roadmap addressing both the capital and fleet needs of the national carrier.

In a press release issued on the same day, the advisor emphasised the immediate funding requirements for PIA.

The presented plan, according to the advisor, not only promises short- and medium-term benefits but also positions PIA as a viable and globally competitive airline in the long run.

However, the Federal Minister recommended a thorough review and rationalisation of the projections before submitting the plan for approval to the federal cabinet.

The proposed legal segregation plan, transaction structure, and business plan, along with the valuation methodology, will undergo scrutiny and require the final approval of the federal cabinet.

It is noteworthy that on January 09, 2024, the Financial Advisor had previously presented a proposal for the legal segregation of Pakistan International Airlines Corporation, aimed at separating the core aviation business and assets.

This move is a precursor to the eventual divestment of core aviation services, with the core assets, including basic engineering services and international routes, offered for sale to potential buyers.

Simultaneously, non-core assets will be retained in a Holdco structure for subsequent divestment through separate structures and transactions.

Beyond the ongoing divestment discussions in the market, there’s been a positive development for PIA earlier this month. The airline successfully inducted one of its two A320 aircraft into its fleet, resolving a payment dispute in Malaysia that had previously entangled the acquisition.

This development adds a positive note amid the broader strategic discussions and plans for the national carrier’s future.

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