Airline groups competing to buy minority share in TAP want guarantees

The airline three groups running for the purchase of Portuguese airline TAP must present non-binding proposals by April 2 but they want guarantees on their side, especially regarding the value that the company can provide the buyer.

The three groups interested in the privatisation of TAP – IAG, Air France-KLM and Lufthansa – have already presented results, with profits and revenues in the order of billions of euros, and have addressed the privatisation process for which they are competing.

In addition to the value proposed by the Portuguese company, for a minority shareholding, the groups want to know whether the integration will create value for their shareholders.

The first to speak out was the French-Dutch Air France-KLM, on February 19: “It depends on the price to be paid and the management structure”, said Steve Zaat, the group’s financial director, repeating words that were shared by CEO Benjamin Smith.

Air France-KLM wants the Portuguese Government to hand over management to the private sector that will invest in the flag carrier.

For now, the group admits that it is working on the non-binding proposal, whose deadline for delivery ends on April 2nd.

IAG, the owner of Iberia and British Airways followed. The only mention of TAP appeared in the report and accounts referring to its 2025 results, with the topic to be avoided in the “call” with analysts.

However, it was enough to position itself and showed that it will only moves forward under one specific condition. “We think it is an interesting strategic opportunity for the group, but only if it is in terms that create value for IAG shareholders”, stresses the Anglo-Spanish aviation group.

This same investment condition was also voiced by Lufthansa CEO, Carsten Spohr. “With this transaction, even if it is strategically interesting, we will only move forward if we create profits for our shareholders, and it also depends on the costs and the price that will have to be paid”, he said in reference to the effective price of the deal and the costs of a legal case taking place in court over crew members for which TAP had raised €41 million in the 2024 accounts, and the ongoing civil lawsuit with former CEO Christine Ourmières-Widener.

“And as to what our competitor said in London [in reference to IAG], we can only repeat: it also has to do with shareholders, but it is still too early to make a statement about that”, said the Lufthansa CEO.

In February, the airline groups met with TAP management and the Portuguese team presenting the strategy and plan outlined for the company for the next few years. At the meeting the airline groups raised questions to clarify issues according to the news source Expresso.

Source: Negócios; Credits: TAP.