Pakistan on Tuesday successfully concluded the privatisation of its national flag carrier, Pakistan International Airlines, selling it for approximately $482 million USD (Rs 135 billion) to a consortium led by local investment firm Arif Habib.

The privatisation ceremony was held in Islamabad, where all three pre-qualified bidders Lucky Cement, private airline Airblue and investment firm Arif Habib deposited their sealed bids into a transparent box in the first phase of the process.

In the second phase, the bids were opened publicly. Arif Habib emerged as the highest bidder with an initial offer of Rs 115 billion, followed by Lucky Cement at Rs 105.5 billion and Airblue at Rs 26.5 billion.

After the bids were opened, the government announced a reference price of Rs 100 billion. In line with the rules, the two highest bidders Arif Habib and Lucky Cement were invited to participate in an open auction.

Both parties engaged in a competitive bidding process, incrementally raising their offers. The contest concluded when the Arif Habib group placed a final bid of Rs 135 billion, which remained unchallenged.

“We congratulate Arif Habib group,” a member of the Lucky Cement said while yielding to the massive offer by the rival.

The government had initially offered a 75 per cent stake in PIA. The successful bidder will have 90 days to purchase the remaining 25 per cent shares.

Under the privatisation rules, 92.5 per cent of the proceeds from the sale of the initial 75 per cent stake will be allocated to PIA for reinvestment, while the remaining 7.5 per cent will be transferred to the government.

The investor will also be required to commit Rs 80 billion in investment over the next five years. The government had earlier assumed responsibility for PIA’s liabilities amounting to Rs 654 billion last year.

The entire bidding process was broadcast live on local television channels to ensure transparency.

This auction marked the second attempt to sell the airline, after a previous effort last year failed to fetch the desired price.

Earlier in the day, Prime Minister Shehbaz Sharif, while addressing a meeting of the federal cabinet, thanked government officials and the Privatisation Commission for their role in completing the privatisation of the national carrier.

He stressed that the process had been made “transparent“, adding that it would be the “largest transaction” ever in Pakistan’s history.

PIA was once regarded as one of the world’s leading airlines, but years of mismanagement eroded its services and reputation, eventually leaving the government with little option but to proceed with its sale.