SECP okays PIACL restructuring

Privatisation Commission says 'complex task' finalised

ISLAMABAD:

The Securities and Exchange Commission of Pakistan (SECP) has given the nod to the restructuring of the Pakistan International Airlines Corporation Limited (PIACL), the Privatisation Commission announced on Sunday.

According to a statement issued by the Privatisation Commission, the legal separation of the PIACL for its restructuring was an extremely "complex task" but now it had been finalised.

It explained that the SECP -- under the approval of a scheme of arrangement granted on May 3 -- had given the nod to the transfer of non-core assets and liabilities of the PIACL to the PIA Holding Company Limited.

The statement read that this order for the restructuring of the PIACL was an important milestone in the joint efforts of the Privatisation Commission (PC), Finance Division, aviation ministry and national carrier.

Read PIACL sell-off top priority: Asif

The scheme has been made effective from April 30 this year.

The SECP has directed the Pakistan Stock Exchange (PSX), Central Depository Company (CDC), and National Clearing Company of Pakistan Limited (NCCPL) to ensure the listing of PIA Holding Company Limited as per applicable rules and regulations.

Last month, the PIA shareholders gave approval for the airline’s restructuring, likely to occur by July-August this year.

This move anticipated encountering no political resistance to the sell-off of the national carrier’s core operations, potentially to foreign investors because of the need for foreign exchange -- as recommended by the International Monetary Fund.

However as the privatisation process of the PIA kicked off, foreign companies are apparently not interested in acquiring the majority stakes in the national carrier.

Only two companies from the Gulf countries received documents for investment by depositing $5,000.
These two firms have not even submitted their applications for tenders yet.