Aconsortium headed by BNP Paribas on 8 October was awarded a two-stage contract for the privatisation of Saudi Arabian Airlines. Also in the consortium are Kuwaitbased Gulf Investment Corporation and its subsidiary Gulf International Bank, the New York-based aviation industry consultant SH&E and KPMG Consulting. A separate legal consultancy contract has been awarded to Clifford Chance.

The first stage of the programme, which will run for 13 months, will see the consortium prepare a study and submit proposals for the way in which the privatisation will be conducted. After a period in which the proposals are evaluated, the second phase, which is to be completed over 17 months, will see the implementation of the proposals, subject to approval.

Analysts say an initial public offering (IPO) is likely to be an important part of the process, though a strategic sale remains a possibility.

'I can say. . . that after we finalise the study. . . we offer our citizens a large, successful and promising facility for successful investment which will be managed as any profit-making private institution, ' Saudi Defence & Aviation Minister Prince Sultan said in a statement.

Three other bank-led groups bid for the contract (MEED 13:10:00).