Lufthansa signals push for full control of TAP

Lufthansa said on Wednesday that its planned 44.9% acquisition of TAP Air Portugal should support the airline’s growth and strengthen Portugal’s links with North and Latin America, while also signalling that it wants to increase its holding over time. The German group is positioning TAP as part of its wider South Atlantic strategy.

In a statement after winning the TAP privatisation, Lufthansa said previous deals had shown that “a majority stake generates additional benefits for all parties involved”. The group is buying 44.9% of TAP for €1.201 billion under the government’s decision, alongside an investment plan to expand TAP’s fleet to 130 aircraft.

Chief executive Carsten Spohr said the Portuguese government’s decision had opened the way for TAP to “continue this success story together with the Lufthansa Group” and would allow Lufthansa to strengthen its position in the South Atlantic market. According to the government presentation, integrating TAP would raise Lufthansa’s South America market share to 20% from 9%, helped by the Portuguese carrier’s strong Europe-Brazil network.

Lufthansa also submitted a proposal for the remaining 50.1% of TAP that was left out of this stage of the privatisation, as requested by the government. That proposal includes €863 million in cash and a share swap that would give the Portuguese state a 5% stake in the German group. Prime Minister Luís Montenegro said after the cabinet meeting that the government will launch a process to sell all of TAP by 2028.

The German airline said it is now working with the Portuguese government and state holding company Parpública to finalise the transaction documents and expects to sign the agreements soon.

Originally published at Eco.pt