Lufthansa has been selected to acquire a stake of up to 49.9% in TAP Air Portugal, beating rival Air France-KLM in Portugal’s ongoing privatisation of its national carrier.
Announced on 14 October, the decision will see Lufthansa pay up to €1.201 billion for the initial stake, while the Portuguese state retains its 50.1% majority shareholding. The transaction remains subject to the necessary approvals before it can be completed.
The deal gives Lufthansa an opportunity to strengthen its position in southern Europe while gaining access to TAP’s established network across Brazil, Portuguese-speaking Africa and North America.
Why Lufthansa Wants TAP
Lisbon is one of TAP’s biggest strategic advantages. The airport serves as an important connecting point between Europe and Brazil, with the airline maintaining a substantial presence in the South Atlantic market. Lufthansa already operates a large network through its hubs in Germany, Switzerland, Austria and Italy. Adding TAP would extend that reach, while giving the group greater access to Portugal and markets where the Portuguese carrier has an established presence.
Both Lufthansa and Air France-KLM recognised the value of TAP’s network, but Lufthansa’s financial offer was reportedly 16% higher than its competitor’s. The Portuguese government also cited a lower degree of uncertainty in selecting the German group.
Fleet Growth and Investment
Lufthansa’s proposal includes plans to expand TAP’s fleet to 117 aircraft by 2035, with the number expected to reach 130 thereafter. Up to eight Airbus A350-900s could also be transferred to the Portuguese carrier after 2030, providing additional capacity for long-haul operations.
The plans extend beyond Lisbon. Porto is expected to play a greater role in TAP’s operations, while investment is also planned for Faro and airports in Portugal’s autonomous regions.
Maintenance and engineering are another part of the proposal. Lufthansa Technik is developing a facility in Santa Maria da Feira, near Porto, which is expected to increase the group’s presence in Portugal and create additional skilled jobs.
What Happens Next?
Although Lufthansa has been selected as the preferred bidder, it will not immediately own a majority of TAP. The initial transaction covers up to 49.9%, including shares that employees have the right to purchase. A second phase could eventually see Lufthansa acquire the Portuguese state’s remaining 50.1% stake. The proposal envisages an additional €1.351 billion in value, including €863 million in cash and a shareholding equivalent to 5% of the combined Lufthansa-TAP group for Portugal.
The government has indicated that this phase could be completed by July 2028, subject to the required process and approvals.
The acquisition would strengthen Lufthansa’s position in the European airline market, but TAP’s value lies in more than its fleet or passenger numbers. Its links with Brazil and other South Atlantic markets give it a distinct role within the group’s network.
