TAP Air Portugal Airbus A330ceo and A330neo aircraft
The Portuguese government has settled on a price for a minority stake in TAP Air Portugal, as potential airline investors have circled the Portuguese carrier for several years, especially after the pandemic.
According to a report by the Spain-based outlet Okdiario, the Portuguese government’s asking price for a 44.9% stake in TAP Air Portugal is no less than €700 million ($817.7 million), with another 5% being allocated to the airline’s employees.
The 44.9%, 5%, and 50.1% split echoes the statement of LuĂs Montenegro, the Prime Minister of Portugal, who, on July 10, 2025, announced that the country’s government is fulfilling its pre-election promise of privatizing the airline by initiating the process of doing so.
Montenegro retained his position as Prime Minister of Portugal following a snap election on May 18, 2025, after President Marcelo Rebelo de Sousa dissolved the parliament, citing a political crisis within the Portuguese government that was spurred by Montenegro’s potential conflicts of interest.
Nevertheless, over the past few years, Air France-KLM, the International Airlines Group (IAG), and Lufthansa Group have emerged as potential suitors for the Portuguese carrier. At the same time, both Air France-KLM and Lufthansa Group have been involved in acquisitions of their peers, with the two airline groups acquiring – or being in the process of doing so – stakes in SAS (60.5%) and ITA Airways (41%), respectively.
When it announced its intentions to acquire the minority stake in the Italian carrier in May 2023, the German airline group said that it had “the option to acquire all remaining shares at a later date.” Meanwhile, the European Commission (EC) has yet to open up its case into Air France-KLM and SAS.
The Commision’s approval of Luthansa Group’s acquisition of a 41% stake in ITA Airways came after it had requested remedies that included promises to maintain effective competition on short-haul routes between ITA Airways’ and Lufthansa Group’s hubs, divest slots at Milan Linate Airport (LIN), and enable an additional 10 weekly indirect connections offered by independent competitors on long-haul flights from Rome Fiumicino Airport (FCO) to San Francisco International Airport (SFO), Toronto Pearson International Airport (YYZ), and Washington Dulles International Airport (IAD). All three North American airports are hubs of airlines that are part of the A++ joint venture (JV), namely Air Canada and United Airlines.
Air France-KLM’s statement about converting its minority stake of 19.9% to 60.5% in SAS on July 4, 2025, said that the Franco-Dutch group plans to complete the transaction in the second half of 2026.
IAG, the parent company of Aer Lingus, British Airways, Iberia, and others, has also expressed interest in an investment in TAP Air Portugal. However, not only was IAG forced to walk away from its planned acquisition of 80% of Air Europa’s shares following the EC’s demands, but its own executives have also expressed scepticism about the potential acquisition.
During the group’s Q2 2025 earnings call on August 1, 2025, Luis Gallego, the Chief Executive Officer (CEO) of IAG, confirmed that the group had been interested in acquiring a stake in TAP Air Portugal since the group is “the best place to develop TAP.”
“But as I said, we need to wait to see the conditions [of the Portuguese government],” Gallego added, noting that IAG cannot achieve its medium-term target of operating margins between 12% and 15% in each of its subsidiaries if “we don’t have the freedom to do the right thing to develop the business.” That is going to be the primary concern for IAG if it does go through with a potential acquisition of a stake in TAP Air Portugal, Gallego added.
Montenegro’s July 10, 2025, statement read that the goal of the privatization was to “safeguard the most strategic routes for Portugal, the country’s strategic interest, and the sustainability” of TAP Air Portugal. Furthermore, the country’s Prime Minister expressed the desire to ensure that any incoming investor makes the most out of the carrier’s hub at Lisbon Airport (LIS) and the future airport that would eventually replace the overcrowded airport serving the Portuguese capital.
“We do not want to continue throwing money into a bottomless pit, we want the airline to be profitable, well managed, framed within a competitive framework, to be financially sustainable and at the service of the country’s strategic interest,” Montenegro concluded at the time.
On August 7, 2025, de Sousa, “following government clarifications,” approved TAP Air Portugal’s privatization process to move forward.
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