In a major development, SECP approves PIA’s restructuring plan

• The restructuring plan was approved by the SECP on May 3.
• The program came into effect on April 30, 2024.
• PSX, Finance and Privatization Ministries also informed.

ISLAMABAD: In a major development, the Securities and Exchange Commission of Pakistan (SECP) has approved the legal separation of Pakistan International Airlines (PIA) which is one of the most complex restructuring actions undertaken.

According to a press release issued by the Ministry of Privatization on Sunday, the restructuring plan was approved on May 3 to transfer PIA’s non-core assets and liabilities to PIA Holding Company Limited.

Pakistan Stock Exchange (PSX), ministries of finance and privatization, Central Depository Company (CDC) and National Clearing Company Limited (NCCL) have been informed about the scheme, the press release said.

This order marks a major milestone in the collaborative efforts of the Privatization Commission, the Finance Department, the aviation ministry and PIA to restructure the national carrier.

The scheme became effective from April 30, 2024, the press release said, adding that the SECP has directed PSX, CDC and NCCL to ensure smooth listing of PIA Holding Company Limited as per applicable rules and regulations.

PIA Privatization Plan

Pakistan, in deep financial crisis, agreed in June 2023 to overhaul loss-making state-owned enterprises as part of a deal with the International Monetary Fund (IMF) for a $3 billion bailout.

The government decided to privatize PIA a few weeks after signing the deal with the IMF.

The caretaker government, which took office in August to oversee elections on February 8, was authorized by the outgoing parliament to take all necessary measures to meet fiscal targets agreed with the IMF.

PIA had liabilities of 785 billion Pakistani rupees ($2.81 billion) and accumulated losses of 713 billion rupees as of June last year. Its CEO said losses in 2023 were likely to be 112 billion rupees.