Lufthansa beats Air France-KLM for TAP Air Portugal stake
Dhaka: Portugal's government has picked Lufthansa Group as the winning bidder to acquire an initial minority stake in the country's flag carrier TAP Air Portugal, beating out rival bidder Air France-KLM for the deal.
The German airline group said the move would let it support TAP's growth and strengthen Portugal's connectivity, particularly with North and Latin America.
Portuguese Prime Minister Luís Montenegro said the government chose Lufthansa Group after evaluating the proposals, noting its financial offer was 16% higher than the competing bid and carried a lower level of uncertainty. He made the remarks following a council of ministers meeting on October 14, according to media reports.
Both Air France-KLM and Lufthansa Group had submitted improved final offers for the stake in early October.
TAP holds a strategic position in southern Europe and a strong presence on routes to South America, especially Brazil, making it an attractive target for European network carriers. Lisbon officials have indicated the eventual buyer should be ready to invest in TAP and expand its network beyond the Lisbon hub to other regional airports.
Lufthansa Group CEO Carsten Spohr called TAP a strong and profitable airline and a long-standing Star Alliance partner, adding that the decision allows the group to pursue its internationalization strategy and strengthen its position in the South Atlantic market.
The German carrier also welcomed Lisbon's announcement that it would move ahead with a full privatization of TAP, saying a majority stake tends to bring additional benefits for all parties involved.
Lufthansa, the Portuguese government, and state holding company Parpública are finalizing transaction documents and expect to sign the stake acquisition agreements soon, though completion remains subject to regulatory approval, including from the European Commission.
Lufthansa Group, which took a stake in Italy's ITA Airways in 2025, is separately finalizing an increase of that holding, offering EUR 1.025 billion, equivalent to USD 1.1 billion, for a 44.9% stake, a figure that could rise to EUR 1.2 billion for a 49.9% share.
Air France-KLM, meanwhile, said it was disappointed not to be selected but acknowledged the constructive dialogue throughout the process, adding that it would continue serving Portugal through its hubs and explore options to strengthen its presence in the country and on South American routes.
Lisbon remains the largest European gateway on the Europe-Brazil market, accounting for 31.4% of capacity this winter, ahead of Madrid and Paris Charles de Gaulle, according to OAG Schedules Analyzer data. TAP's share of the market stands at 23.1%, trailing only LATAM, while Lufthansa Group's combined share with ITA sits at 13%.
