TAP Air Portugal Privatization: initial Interest Confirmed, Process Underway
The portuguese government has moved forward with the โprivatization โof TAP โAir Portugal,โ along with its subsidiaries – Portugรกlia, TAP Health Care Unit, Cateringpor, and SPdH (formerly โคGroundforce). The deadline for submitting expressions of interest expired this โฃweek, with confirmed interest from โคmajor airline groups including Airโค France-KLM, Lufthansa,โฃ and International Airlines Group (IAG), the parent company of British Airwaysโ and Iberia.
Parpรบblica, the state-owned entity managing โthe government’s holdings, will now spend the next 20 days, until December 12th, โฃevaluating the โคsubmitted expressions of interest. Candidates will be assessed against criteria including a minimum annual revenue of โฌ5 billion (achieved in at least one of โขthe last three years), demonstrable experienceโ in the โขaviation industry,โ sufficient financial โcapacity, and overall suitability.
Triumphant candidates will thenโค be invited โto โsubmit non-binding proposals withinโค 90โ days. Theseโ proposals will need to outline the proposed purchase โขprice, funding sources, and detailed investment plans focusing on fleet modernization,โ maintenanceโ and engineering capabilities, โคlasting fuelโฃ adoption, upholding labor โคcommitments, and a long-term strategicโ vision, potentially including futureโ increases in ownership stake.
Following the โฃnon-binding proposal phase, Parpรบblica will prepare a report for the Government within 30 days.The Council of Ministers will then select the most promising applicants โฃbased on this report and invite them to submit binding proposals, with a timeframe of up to 90 days. โ
A final report will be prepared by Parpรบblica โคwithin 30 days of receiving the binding proposals (potentially extendable by โthe Council of Ministers). this will lead toโ the selection of the winning bid, โpotentially following a negotiation โคphase for final improvements. The โCouncil of Ministers will then approve โฃthe final โsales contracts, which the buyer must sign within 15 days.
The privatization process is expected to take approximatelyโ one year, contingent โupon receiving necessary regulatory approvals. The government intends to sell up to 44.9% of TAP’s capital, with 5% specifically reserved for employee acquisition. Should โขthe employeeโ allocation not be fullyโค subscribed, the winning bidder will have the right of first refusal for those shares.