Portugal initiates the privatization of national airline, TAP
In a significant move for the Portuguese aviation industry, Prime Minister Luís Montenegro announced the concrete shape of TAP Air Portugal's privatization in Lisbon. The Council of Ministers has decided to sell 49.9% of the shares of state-owned TAP to private hands, aiming to finally realize the long-delayed re-privatization project that was initially initiated by the leftist government.
TAP, Portugal's largest airline, has been a key player in routes to Brazil, South America, and Africa. Despite the losses it incurred during the COVID-19 pandemic, amounting to a record 1.6 billion euros in 2021, the airline returned to profitability in 2024, reporting a net profit of 54 million euros.
Several major European airline groups have expressed interest in TAP Air Portugal and are considered potential suitors for the 49.9% stake. Notably, the International Airlines Group (IAG), parent company of British Airways, Iberia, Vueling, and Aer Lingus, has welcomed the launch of the privatization process and will review the terms of sale once available. IAG has shown strong interest in TAP’s network, particularly its South American destinations.
Air France-KLM, one of the world’s leading airline conglomerates, has also indicated its keenness to participate in the process once more details are known. Lufthansa, while declining to comment on the latest developments, has shown interest in TAP in the past and its recent acquisition of a major stake in ITA Airways (formerly Alitalia) demonstrates an appetite for expansion in Southern Europe.
These three groups are the most likely suitors based on prior expressions of interest and their activity in the European aviation market. However, other private investors or consortia could also emerge as the process progresses. The specific details and conditions of the sale will ultimately determine the final contenders.
Prime Minister Montenegro emphasized that TAP will retain its hub in Lisbon and will ensure the use of all airport infrastructure in Portugal. He expects a strategic partner to bring more economic stability to TAP and boost the national economy. TAP employs over 8,000 people and is particularly strong on routes to Brazil, South America, and Africa.
The TAP privatization is being closely watched in the European aviation industry. Montenegro also stressed that 5% of TAP's shares will be allocated to its employees. The privatization project of TAP had been stalled by two parliamentary elections in 2024 and 2025. The conservative government is now working towards finalizing the TAP privatization project.
The privatization of 49.9% of TAP's capital was decided by the Council of Ministers, marking a significant step forward in the restructuring process that was initiated in 2020 when, due to COVID-related and other issues, the state took control of TAP again. The TAP privatization is a topic of great interest in the European aviation industry, with industry giants like Lufthansa, Air France-KLM, and IAG (parent company of British Airways and Iberia) being potential interested parties.
The privatization of TAP Air Portugal, Portugal's largest airline, has attracted interest from several major European airline groups, such as the International Airlines Group (IAG), Air France-KLM, and Lufthansa, who could potentially bid for the 49.9% stake. The sale of this percentage of shares is expected to provide the airline with a strategic partner and bring more financial stability to TAP, which employs over 8,000 people and serves key routes to Brazil, South America, and Africa.
