• Interview by:
  • António Costa, André Veríssimo e Hugo Amaral

‘There are three aviation groups interested in TAP’

Pedro Nuno Santos felt that TAP should be part of an international aviation group. He rejected a deal with funds and admitted that the BA/Iberia group could be a problem because of the Madrid hub.

The European Commission has approved the TAP restructuring plan and now it will be necessary to move forward with its implementation. In an interview with ECO, the minister for infrastructure and housing, Pedro Nuno Santos, defended TAP’s integration into an international aviation group, but clarified that the state should maintain a shareholder position, as is the case with the French and Dutch governments in Air France/KLM.

You have already said that TAP cannot remain isolated. What is the most desirable profile for an international partner?

The restructuring plan is very demanding. What we are doing at TAP has never been done before, but it can put it on a level with TAP’s viability. And what is the greatest proof of this? It is the stakeholders that TAP has. I can say, in general terms, what I haven’t said yet. There are three funds and three aviation groups. But without any margin of doubt, the most desirable are companies in the aviation sector. I hope and wish that any government that wants to privatise TAP does not hand the company over to funds or to some businessman without the financial capacity to have an aviation company, that would be a disaster. If it is integrated into an aviation group, it must have rules and a very firm shareholder contract, as guaranteed by the French and Dutch governments, that is, to preserve the hub in Portugal at all times.

The discussion on whether or not to sell should be assumed politically. We believe that TAP should be integrated into an aviation group, which is already something, any more than that would weaken TAP’s future negotiations.

And in that scenario, do you admit the privatisation of 100% of TAP?

I don’t want to say anything more about it, for a very simple reason. One of the things that the European Commission does with many companies, wrongly, is to impose dates for the sale. Fortunately, for negotiation reasons, we managed not to have it applied to Groundforce, Cateringport or ME Brasil, and many people thought it would also be imposed [a timeframe] for TAP itself, but it wasn’t. And it wasn’t because the worst thing you can do from the point of view of a business relationship is for the potential buyer to know that whoever wants to sell has to sell.

The discussion on whether or not to sell should be assumed politically. We believe that TAP should be integrated into an aviation group, which is already something, any more than that would weaken TAP’s future negotiations.

You know the aviation industry groups want management control and a majority, if not all of the capital. Do you see as possible a model where the State maintains a partnership model similar to the one you had with David Neeleman?


Don’t inhibit yourself…

… I inhibit myself, I inhibit myself. There are corporate relationships that I think are bad for the state and for the private sector. I think they should be clear. We got a restructuring plan approved, we have to implement it, most of the aviation groups are still prevented from making acquisitions…

Lufthansa already can.

Lufthansa can’t…

And Air France/KLM are in the process of being able to.

I hope they also succeed in the short term, because we don’t want to have just one interlocutor.

It is easy to identify the three potential groups. What about BA/Iberia?

Obviously, I really know the difference between the three [aviation groups] and I really know which hub competes with us the most.

It is Madrid, so…

It is not… We do not exclude anyone, nor did I say they were those three groups, nor do I say they are not. The more interested parties we have relating to TAP, the better. The more disputed TAP is, the better for TAP and for the country. If we were more careful in the way we partnered in the past, our companies would be better off.

Is it credible to consider that privatisation could occur within the restructuring plan period, until 2024?

I can say that TAP’s capitalisation has made the company much more valuable. Again, I am not assuming that we want to privatise anything…

… There is no point in playing with words. A codeshare agreement is not about integrating TAP into an international group.

In fact, it is not. And I don’t want to play with words either, although there are sales or mergers, different models that allow the Portuguese state to maintain a position. We look at KLM/Air France and we see that the French State has 30% at the moment, but it will reduce, and the Dutch state has 6% or 7%. But I can’t say anything that immediately draws conclusions.

But what is the timeframe? That of the restructuring plan?

It is not impossible, but it is difficult. Even if all these companies can, already, enter into negotiations, and it is a long process. I think one year is not enough. Either due diligence, the [new] parliamentary configuration itself. There are a number of elements that are very important, it is not impossible, but…

  • António Costa
  • André Veríssimo
  • Hugo Amaral
  • photojournalist