Portugal’s government has selected Lufthansa Group to acquire a 44.9% stake in TAP Air Portugal, defeating Air France-KLM after both airlines submitted improved final bids. The initial purchase price is €1.025 billion, with the potential value rising to about €1.2 billion if Lufthansa acquires employee-reserved shares and other applicable payments. The Portuguese state will retain majority ownership of the flag carrier.
The decision followed a cabinet meeting on Wednesday. Officials judged Lufthansa’s offer to be 16% higher than Air France-KLM’s and to carry less uncertainty. Up to 5% of TAP’s shares will be offered to employees, while the state will retain at least 50.1%.
Lufthansa is expected to assume executive and operational management while supporting TAP’s growth and preserving its national identity. The group has identified stronger connectivity between Portugal and North and Latin America, including Brazil, as a strategic priority.
The transaction has not yet closed. Lufthansa and the Portuguese government must finalise and sign the transaction documents, and the acquisition remains subject to approval from the relevant authorities, including European Union regulators. Portugal’s finance minister has indicated that the wider privatisation process could take 18 to 24 months and potentially conclude in 2028.