MTC Advises Financiers On Landmark PKR 268 Billion Debt Restructuring Of PIA

Mohsin Tayebaly & Co. was engaged as transaction legal counsel with respect to the finance facilities in the aggregate amount of up to PKR 268,695,923,149/- (Pak Rupees Two Hundred Sixty Eight Billion Six Hundred Ninety Five Million Nine Hundred Twenty Three Thousand One Hundred Forty Nine) being availed by PIA Holding Company Limited (Hold Co) from a consortium of banks, financial institutions, mutual / employee funds and corporates, including but not limited to The Bank of Punjab, Habib Bank Limited (Pakistan branch and Export Processing Zone Branch), National Bank of Pakistan (Pakistan branch and Bahrain branch), Bank Islami Pakistan Limited and Faysal Bank Limited.

The facilities comprise of:

(i) a mark-up based syndicated facility in the aggregate amount of up to PKR 197,568,771,583/- (Pak Rupees One Hundred Ninety Seven Billion Five Hundred Sixty Eight Million Seven Hundred Seventy One Thousand Five Hundred Eighty Three);

(ii) financing under the Islamic mode of diminishing Musharaka in the aggregate amount of up to PKR 52,614,061,884/- (Pak Rupees Fifty Two Billion Six Hundred Fourteen Million Sixty One Thousand Eight Hundred Eighty Four);

(iii) issuance of redeemable capital in the form of Shariah compliant Sukuk certificates in the aggregate amount of up to PKR 3,496,821,861/- (Pak Rupees Three Billion Four Hundred Ninety Six Million Eight Hundred Twenty One Thousand Eight Hundred Sixty One);

(iv) a syndicated finance facility to the extent of USD 54,007,581/- (United States Dollars Fifty Four Million Seven Thousand Five Hundred and Eighty One); and

(v) a mark-up based syndicated facility in the aggregate amount of up to PKR 15,016,267,821/- (Pak Rupees Fifteen Billion Sixteen Million Two Hundred Sixty Seven Thousand Eight Hundred Twenty One).

The facilities are intended to be utilized for the purposes of (a) funding the repayment and settlement of certain liabilities transferred to the Hold Co from Pakistan International Airlines Corporation Limited (PIA) pursuant to the scheme of arrangement sanctioned by the Securities and Exchange Commission of Pakistan pursuant to Sections 279 to 283 and 285(8) of the Companies Act, 2017 under which certain liabilities have been transferred to the Hold Co from PIA; and (b) funding the repayment of one of the facilities availed by the Hold Co in relation to (a) above.

The Firm’s scope of work included full scope financier-side advisory.

MTC’s team in this matter was led by Mehreen Manto (Partner) and included Kamil Tayebaly (Senior Associate), Arsalan Abid Bachani (Associate) and Yawar Burki (Associate).