EUROPE- The German flag carrier Lufthansa (LH) and Air France-KLM have shown interest in TAP Air Portugal (TP) after the Portuguese government’s announcement of its intention to sell a majority stake in the national airline.
The government made an official statement on Thursday, revealing that the Council of Ministers had approved a decree to sell at least 51% of TAP Air Portugal while reserving up to 5% for its employees.
Lufthansa Air France-KLM to Buy TAP Portugal
Finance Minister Fernando Medina emphasized the government’s aim to attract substantial investors, individually or as part of consortia, who are committed to utilizing TAP Air Portugal to enhance its position as a national hub in Lisbon and increase capacity at other domestic airports, including Porto.
Medina clarified the government’s intention: “We do not seek to attract pure financial investments aimed at acquiring TAP to sell it or its parts later. We want to emphasize TAP’s strategic importance to the country.”
This decision to privatize the airline opens the door for further consolidation within Europe’s aviation industry, following Lufthansa’s acquisition of a 41% stake in ITA Airways (formerly Alitalia) and the agreement by International Consolidated Airlines Group, the parent company of British Airways, to purchase Spanish carrier Air Europa.
Plenty of Benefits
The winning bidder would gain access to TAP’s extensive network and its connections to South America, including Brazil, and other Portuguese-speaking African countries, such as Mozambique.
A spokesperson for the Lufthansa Group stated, “As a general principle, the Lufthansa Group is always interested in actively participating in market consolidation. This is why the planned sale of a stake in TAP Portugal is of interest to us. Lufthansa Group and TAP would complement each other very well, particularly given TAP’s route network to and from South America.”
A spokesperson for Air France-KLM expressed a “strong interest in TAP’s privatization” and mentioned that they were awaiting further details about the process.
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