Portugal has selected Lufthansa Group as the preferred buyer of up to 49.9% of TAP Air Portugal, valuing the first phase of the national airline’s partial privatisation at as much as €1.201 billion. Lufthansa will initially acquire 44.9% for €1.025 billion, while Portugal retains a 50.1% majority stake and up to 5% remains reserved for TAP employees.
The Council of Ministers chose Lufthansa over Air France-KLM after assessing the two binding proposals. The government described Lufthansa’s financial offer as 16% higher and involving less uncertainty. The selected plan also includes a growth strategy for TAP and the possibility of further investment in Portugal, while preserving the airline’s national identity.
If employees do not take up their reserved allocation, Lufthansa may acquire the additional shares, increasing its holding to 49.9%. The headline €1.201 billion represents the maximum value of the first phase rather than the price of the initial 44.9% stake alone.
The transaction has not yet closed. Portugal, Lufthansa and state holding company Parpública must finalise the contractual documentation, and the acquisition remains subject to approval by the relevant authorities, including European competition regulators. Lufthansa’s proposal also provides for a possible second privatisation phase involving additional cash and an equity exchange that could make Portugal a significant shareholder in a combined Lufthansa-TAP entity.