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The Portuguese government revives the privatization of TAP and intensifies the struggle of its suitors

Date: July 15, 2024 Time: 06:10:32

The plan drawn up last September by the Portuguese government, then led by António Costa, to privatize at least 51% of the airline TAP with the intention of guaranteeing the company’s growth was met a month later with the refusal of the president of the Republic, Marcelo Rebelo de Sousa, who paralyzed the operation due to lack of transparency and information about the State’s capacity to control and intervene in a strategic company. Weeks later, the controversial resignation of the Portuguese prime minister ended up complicating an operation, which was left in the hands of the new executive.

At this juncture, the strategy to be followed with the insignia of the Portuguese State marks the first steps of the new government legislature headed by Luis Montenegro, who was quick to reveal his vision on the privatization of the automobile after taking office at beginning of April. As he states in his government program and as stated by his communications office, the executive’s idea is to relaunch “the process of privatization of TAP’s share capital, with the aim of improving management and competitiveness of profitability.”

Although its initiative reveals the intention to continue with the operation that was paralyzed in the previous legislature, the first lines advanced by the government led by Montenegro do not resolve whether or not they intend to maintain a position in the capital of the entity, if the future position will be of control nor when you intend to carry out the process. The new head of the Infrastructure and Housing portfolio, Miguel Pinto Luz, has already been in favor of total privatization in the past. A vision contrary to that held by the previous executive, closer to defending State control over the dryer.

Before the succession of obstacles that have paralyzed the operation, the Decree-Yey that Aprburno Luso included the will to have the Plos Lis O to complete the sale process in the first half of 2024. A deadline, which the company’s top executive , Luís Rodrigues, admitted to seeing “very difficult” given the political uncertainty that has stalked the country in recent months.

The big airlines, on the lookout for the process

The uncertain climate that has surrounded the future of the Portuguese entity has not dissipated the interest seen from the beginning by large European airlines such as IAG, parent company of Iberia and Vueling among others, Air France-KLM or the German Lufthansa. The three possible suitors interested in acquiring a stake in TAP continue to be on the lookout for the dryer that arouses great attraction due to its links with Brazil, of which it is the largest European supplier.

The general director of the Spanish-British holding company has repeatedly expressed his interest in taking control of a position in an airline key to reinforce its programming with connections to Africa and Brazil, if it presents interesting sales conditions. Along the same lines, one of its main rivals, Air France-KLM, spoke out to ensure that they “remain very interested” in the process and are waiting for the next steps, in recent statements reported by Europa Press. The third candidate is Lufthansa, which is in a merger process with ITA Airways and does not have any type of government restriction on making acquisitions after the German government leaves its shareholding in September 2022.

Seals his recovery with a record of 2023

Apart from clearing up doubts about its future, TAP reaped the highest income in its history in the last year, registering a record profit of 177 million euros, which tripled that recorded the previous year. In its balance sheet, the swimsuit highlighted that the 4.2 billion euros it recorded in operating income, 21% more than in 2022, “reflect and confirm the group’s strategic approach to market opportunities.”

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.
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