Two of Europe’s largest airline groups are officially competing for a piece of Portuguese flag carrier TAP Air Portugal, which is in the process of being reprivatized.
Lufthansa Group and Air France-KLM both confirmed Wednesday that they submitted binding offers for a minority stake in TAP through Parpública, Portugal’s state-owned investment company.
The Portuguese government is auctioning off up to 49.9% of TAP, which is headquartered in Lisbon. Air France-KLM said it is seeking between 44.9% and the full 49.9% of the carrier; Lufthansa Group did not say how much of the airline it hopes to acquire.
Neither company provided financial details of their offers.
Air France-KLM said that, if selected, it will help develop MRO capacity in Portugal, expand connectivity to markets such as the Americas and Africa, and make Lisbon its “unique” southern European hub. The company also stressed the potential benefits of TAP’s integration into its passenger and cargo operations and loyalty program.
“What we have submitted today is not just a proposed price for an airline,” Air France-KLM CEO Benjamin Smith said in a news release. “It is a strategic, extensive, and comprehensive long-term plan for TAP and for Portugal as a whole… Our overarching goal is to ensure long-term growth for TAP, not only in Lisbon but also in Porto and other cities in Portugal, and to do so sustainably, as part of a robust and international group determined to bring value to its airlines’ home countries.”
Delta, which has a longstanding strategic partnership with Air France-KLM, backed its ally’s vision for TAP.
“Delta supports our joint venture partner Air France-KLM’s proposed investment in TAP, which would enhance transatlantic travel options and Portugal’s role as an enhanced business and leisure destination,” Delta CEO Ed Bastian said in a statement. “We’re looking forward to seeing Air France-KLM and TAP grow across the Atlantic for years to come, providing more choice, better connectivity, and a stronger network for travelers.”
Lufthansa Group pitched its offer as a continuation of ongoing investments in Portugal, which include the construction of a new Lufthansa Technik facility in Santa Maria da Feira and an expansion of its Portuguese workforce to around 1,000 people by 2030. The company cited its ownership of SWISS, Austrian Airlines, and Brussels Airlines to argue that it can grow subsidiaries while helping them retain their national identity.
Lufthansa Group also said it would strengthen Lisbon’s position as a “strategically important Atlantic hub” within its network.
“For decades, we have been investing in Portugal, creating and securing skilled jobs, and connecting the country with Europe,” Lufthansa Group CEO Carsten Spohr said in a news release. “Our interest in taking a stake in our Star Alliance partner TAP Air Portugal is the next logical step. We want to strengthen Portugal’s national airline as part of the Lufthansa Group and as the leading airline for the South Atlantic, with Lisbon as a strategic hub.”
The Portuguese government has said it hopes to conclude the auction process by August or September.
