Lufthansa to become new TAP shareholder, Portuguese government says

The Portuguese government announced on Wednesday that German airline Lufthansa will become TAP's new shareholder as part of the airline's reprivatisation. Prime Minister Luís Montenegro stated that the government successfully concluded the first phase of the privatization process, ensuring strict adherence to competition rules, negotiating with diligence, and maintaining transparency with Portuguese citizens.

After evaluating the bids, the government opted for Lufthansa, whose financial offer was 16% higher than the competitor's and possessed a lower level of uncertainty. This transaction would inject 1.201 billion euros in the initial phase, retaining a majority stake of 50.1% in the company. TAP's valuation would reach 2.552 billion euros, a figure surpassing previous valuations.

Montenegro highlighted the airline's ambitious strategy, particularly in airport infrastructure, which would lead to growth in TAP, fleet size, passenger numbers, destinations, and routes, as well as investment in other sectors of Portuguese aeronautics. The proposal would also establish a new pilots' school in Tancos, an innovation center in Aveiro, a corporate services center, and investment by Lufthansa Technik in Santa Maria da Feira.

The expansion of the fleet to 117 aircraft by 2035 and 130 after 2035, along with the inclusion of up to eight Airbus A350-900s starting from 2030, were also part of the plan. Additionally, the proposal earmarked 5% of the company's share capital for employee purchase, with the remaining percentage held by the state. TAP suffered a loss of 99.2 million euros in the first half of 2026, a 40% decline compared to the previous year.

The privatisation process is expected to be finalized between 2028 and 2029, after obtaining authorization from the European Commission's Directorate-General for Competition.