Lufthansa and Air France-KLM have submitted improved binding offers for a stake in TAP Air Portugal, moving the Portuguese flag carrier’s partial privatisation closer to a decision.
Portugal’s state holding company Parpública confirmed on 30 September that it had received both revised proposals. It will now assess the offers and prepare a report for the government, with Infrastructure Minister Miguel Pinto Luz having indicated that a preferred bidder would be selected by mid-October.
The financial terms have not been disclosed, leaving the value of each bid and the scale of any increase unclear.
A minority stake with strategic importance
The process centres on a 44.9% stake in TAP, with a further 5% reserved for employees. The successful bidder could acquire shares not taken up by staff, potentially increasing its holding to 49.9%. Portugal would retain a majority stake of 50.1%.
Both airline groups submitted their initial binding bids in July. The government subsequently requested improved proposals after judging the competing offers broadly equivalent overall, despite differences in their content.
The decision will extend beyond the purchase price. Portugal wants a partner capable of strengthening TAP’s long-term competitiveness and supporting connectivity across the country, including airports outside its main Lisbon hub.
For either bidder, TAP offers an established position in the South Atlantic market, particularly through its extensive Brazilian network. Its links with Portuguese-speaking African countries and North America further strengthen its appeal.
Two groups compete for Lisbon
Air France-KLM confirmed its final offer on 30 September, presenting a strategy covering passenger services, cargo, loyalty programmes and aircraft maintenance.
Chief executive Benjamin Smith said Lisbon would become the group’s exclusive southern European hub if its proposal succeeds. The group has also emphasised preserving TAP’s Portuguese identity while expanding connections through its wider network and partnerships.
Lufthansa, meanwhile, has argued that it is well placed to support TAP’s growth and strengthen its role as Portugal’s flag carrier. The airlines already share membership of Star Alliance, providing an existing basis for cooperation.
A partnership would give Lufthansa another major connecting point in Europe, with Lisbon adding a geographically distinct gateway to South America and Africa.
Financial pressure adds to the stakes
The bidding contest comes as TAP faces pressure from rising operating costs. The airline reported a net loss of €99.2 million for the first half of 2026, approximately 40% higher than a year earlier, despite record revenue and passenger traffic.
Higher fuel expenditure contributed to the deterioration, underlining the challenge facing whichever group becomes TAP’s strategic partner.
For Portugal, the process therefore combines an ownership decision with questions about investment, network development and the airline’s financial resilience. Both bidders have now strengthened their proposals, but no winner has been announced. The government’s assessment will determine which group gets the opportunity to shape TAP’s next chapter.
