The Portuguese government is proceeding with the privatization of its flag carrier, TAP Air Portugal, by entering into a negotiation phase with the two bidders, Air France-KLM and Lufthansa. This decision comes after the state holding company Parpublica delivered its assessment of the binding offers submitted by the airlines. The government's goal is to finalize the sale of a 44.9% stake in TAP this year, with an additional 5% reserved for employees.
The bids, submitted in July 2026, include both strategic industrial plans and financial offers. While the financial details have not been disclosed, analysts at Bernstein valued the 44.9% stake at approximately €700 million ($798 million), implying a total valuation of €1.5 billion for TAP. The government has emphasized that its final decision will not solely depend on price but also on which bidder can best enhance TAP's international presence and competitiveness.
TAP's primary appeal lies in its strategically important Lisbon hub, which offers lucrative routes to Brazil, Portuguese-speaking African countries, and the United States. Air France-KLM has proposed making Lisbon its sole hub in southern Europe and integrating TAP into the SkyTeam alliance and its transatlantic joint venture with Delta. Conversely, Lufthansa plans to maintain TAP within the Star Alliance, operating it as another hub alongside its existing portfolio of airlines such as SWISS, Austrian Airlines, Brussels Airlines, and ITA Airways. The government may either select a winning bid after negotiations or invite the bidders to submit improved final offers.
