Gulf airlines evasive over PIA purchase reports

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Gulf airlines have sidestepped commenting on reports that they are looking to purchase cash-strapped Pakistan International Airlines (PIA).

Pakistan’s Minister of State for Privatisation, Mohammad Zubair, had told a foreign news agency on Thursday that Emirates, Etihad Airways and Qatar Airways could be possible suitors to buy-up the state-owned airline.

Emirates was the only airline of the three to unequivocally dismiss the reports in saying that it is not interested in purchasing the airline. “Emirates has no plans to acquires stakes in other airlines. We remain focused on our own organic growth,” an airline spokesperson told Gulf News by email.

Emirates once held a 44 per cent stake in Sri Lankan Airlines but sold its share to the Sri Lankan government in 2010. The airline has since dismissed any suggestions it would ever purchase a stake in another airline again. Etihad Airways and Qatar Airways, however, were both evasive in responding to the reports.

An Etihad spokesperson told Gulf News by email: “It is our policy not to comment on rumours or speculation. If or when we do make further investments, we will announce them in line with regulatory and commercial requirements.”

Etihad has splurged on buying up stakes in eight airlines from as far as Australia to Ireland. The airline has adopted the strategy of buying shares in ailing airlines that it believes it can turn around while also giving itself a footprint into source markets. Etihad latest bid has been to take a 49 per cent stake in Italy’s Alitalia, which has been slated to be completed by years end. Last year’s 33.3 per cent stake taken in Darwin Airline, now known as Etihad Regional, is pending regulatory approval. A spokesperson for Qatar Airways told Gulf News the airline was “unable to comment at this time.”

The Pakistani government plans to split PIA into two companies and sell the control of the airline over the next 18 months, Reuters reported on Thursday.

Zubair said financial advisers were in talks with airlines to take over the Pakistan national carrier, which has 17,000 employees and 36 aircraft, of which 10 are currently grounded due to a lack of spare parts.

“It’s going to be the most difficult sale,” he said.

Zubair wants to see the airline become its own separate entity while the government hangs onto PIA’s other interests, including ground handling and hotels, under a holding company. The state will then sell off each of its interests individually over time.

 

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