By Mauro Orru
Three major European airlines, namely British Airways parent International Consolidated Airlines Group, Deutsche Lufthansa, and Air France-KLM, have expressed their interest in acquiring a majority stake in TAP Air Portugal. The Portuguese government recently announced its plans to sell at least 51% of the company, while also reserving up to 5% for its employees.
On Thursday, the Council of Ministers gave its approval to a decree that would facilitate the sale. Finance Minister Fernando Medina stressed the government’s intention to attract large-scale investors, either alone or in consortia, who can harness their control over the airline to foster growth at its national hub in Lisbon as well as increase capacity at other national airports such as Porto.
“We are not looking for purely financial investors who are only interested in buying and potentially reselling or divesting parts of TAP. We want to emphasize TAP’s strategic importance to our country,” explained Medina.
This move towards privatization opens the door for further consolidation in Europe’s aviation industry. Notably, Lufthansa recently acquired a 41% stake in ITA Airways (previously Alitalia), while International Consolidated Airlines Group is set to acquire Spanish carrier Air Europa.
The upcoming acquisition of TAP Air Portugal by one of these industry giants will undoubtedly have a significant impact on the airline and the overall European aviation landscape.
Airlines Compete for Stake in TAP Portugal
Various airlines express interest in acquiring a stake in TAP Portugal as the market recovers
Several major airline groups have expressed interest in acquiring a stake in TAP Portugal, an opportunity that could boost their operations and expand their network. International Airlines Group (IAG), which includes British Airways, Iberia, and Aer Lingus, sees the potential for developing the Lisbon hub and enhancing connectivity. Other contenders, such as Lufthansa Group and Air France-KLM, also recognize the value of TAP’s extensive network, particularly its connections to South American destinations.
TAP Portugal offers access to an expansive network that includes routes to Brazil and Portuguese-speaking countries in Africa like Mozambique, Sao Tome, and Principe. This has caught the attention of many airlines, who view it as an opportunity for growth and market consolidation. The potential deal comes at a favorable time, as the airline industry experiences a gradual recovery from the impact of the pandemic. Airlines are witnessing an increase in demand, resulting in the addition of routes and expansion of overall capacity.
As the Portuguese government evaluates the privatization process for TAP Portugal, multiple airline groups eagerly await further details. With competition heating up, it remains to be seen which contender will emerge as the successful bidder for this valuable stake.