Portugal invites binding bids for 49.9% of TAP

Portugal’s government has formally invited Air France-KLM and Lufthansa to submit binding bids in the privatisation of TAP, advancing the sale of a 49.9% stake in the airline. The move matters for investors and the aviation sector because it takes the process into a more decisive stage after the initial non-binding offers.

The Council of Ministers approved the formal invitation following a recommendation from state holding company Parpública, according to ECO’s reporting. Air France-KLM and Lufthansa were the only groups to submit non-binding offers by the April 2 deadline for the purchase of 44.9% of TAP, plus a further 5% reserved for employees.

Under the tender rules, the two groups now have 90 days from receiving the invitation to submit binding offers to Parpública. At this stage, they may gain access to more detailed information on the airline through due diligence and will have to commit to the financial terms of their bids.

IAG, the owner of Iberia and British Airways, is no longer in the race. The group said earlier that, after a careful review, it had decided it was not in shareholders’ best interests to continue, adding that it needed a path to full ownership in any acquisition process.

After the binding bids are submitted, Parpública will have another 30 days to deliver a new report to the government. The government can then either choose a winner or open a negotiation stage with one or more bidders for improved final offers. Based on those deadlines, the process is unlikely to be completed before late summer, while regulatory approvals mean the sale is only expected to close in 2027.

Originally published at Eco.pt