Portugal Initiates Formal Negotiations with Air France-KLM and Lufthansa for TAP Air Portugal Stake

Portugal’s Minister of the Presidency, António Leitão Amaro, confirmed on Friday that the government will commence negotiations with the two competing bidders for TAP Air Portugal—Air France-KLM and Lufthansa—following the submission of binding offers at the end of July.

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Speaking to the Lusitanian news agency, Leitão Amaro noted that while the two proposals differ in structure, their overall valuations are remarkably similar, which the government believes warrants a concentrated negotiation effort to secure enhanced terms from both parties and ultimately move toward a single preferred bidder for final discussions.

Parpública, the state holding company managing Portugal’s equity positions, submitted its comprehensive assessment of the two binding offers to the government on 1 September, following a thorough 30-day evaluation period.

Two Binding Offers

Air France-KLM and Lufthansa submitted their respective bids on 29 July, meeting the deadline for acquiring a 44.5% stake in TAP Air Portugal. Parpública subsequently conducted an extensive review of the documentation before presenting its findings to the government. Following this assessment, authorities may invite one or both bidders to enter into detailed negotiations and present revised final proposals.

The partial divestiture of the national carrier, reinitiated in 2025 by the Luís Montenegro administration, has been narrowed to two suitors following the withdrawal of International Airlines Group (IAG)—parent company of Iberia—leaving Air France-KLM and Lufthansa as the remaining contenders.

The governing decree, ratified by the government a year prior, permits the sale of up to 49.9% of TAP to private investors, with 5% allocated for employees, while the Portuguese state retains majority ownership.

Minister for Infrastructure Miguel Pinto Luz has indicated that the selected investor could potentially assume joint management responsibilities as early as 2026, working alongside the existing board, though the actual capital injection is not anticipated until summer 2027.

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