 has revealed plans for restructuring and its shareholders will vote on this proposal.){kind=link}
PIA Shares Restructuring Plan Ahead of Shareholder Meeting. Pakistan International Airlines Corp Limited (PIAA) has unveiled plans for restructuring, with shareholders set to vote on the proposal at an Extraordinary General Meeting on April 20th, 2024, in Karachi.
The plan involves dividing the business into two entities: the Core Undertaking (PIA) and the Non-Core Undertaking (Holdco). The Non-Core Undertaking will include assets unrelated to aviation, such as hospitality and real estate, and will transform into PIA Holding Company Limited (Holdco).
Board gives nod to PIA privatisation plan
The Board of Directors (BoD) of Pakistan International Airlines (PIA) has endorsed the privatization and restructuring plan. This development was shared in a notice to the Pakistan Stock Exchange (PSX) on Tuesday.
“In its 83rd meeting held on March 25, 2024, the Board of Directors approved the Scheme of Arrangement (SOA) for restructuring and privatization of Pakistan International Airlines Corporation Limited along with its ancillary modalities, to be filed with Securities and Exchange Commission of Pakistan (SECP),” read the notice. PIA Shares Restructuring Plan Ahead of Shareholder Meeting.
Existing shareholders will maintain their ownership percentage by exchanging their PIAA equity for fresh shares in the holding company, preserving their interests.
PIA Board Give Go Ahead To Restructuring And Privatization
The objective of this initiative is to improve PIA’s financial stability, which will require substantial capital infusion over the next five years. It also lays the groundwork for restructuring PIA as a subsidiary of Holdco, streamlining the privatization process to attract a strategic partner.
As of September 2023, pre-split assets totaled Rs. 171 billion, with Rs. 147 billion attributed to the Core Undertaking and Rs. 25 billion to the Non-Core Undertaking. Shareholders’ equity in PIAA will be replaced with holding company shares, while liabilities will be divided, with Rs. 629 billion allocated to the non-core segment and Rs. 202 billion to the core undertaking.
PIA Holding Company approves Rs268b debt restructuring
Currently, PIA’s net equity stands at Rs. 659 billion, with the core undertaking expected to have Rs. 56 billion post-restructuring, while the remaining Rs. 604 billion will be transferred to the holding company.
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The approval of the scheme is contingent upon sanction by the Securities and Exchange Commission of Pakistan (SECP).