Lufthansa’s CEO, Carsten Spohr, has met with members of the Portuguese government on 2 September with a view to building on discussions about a German takeover of Portugal’s flag carrier, TAP.
The meeting came at the behest of Lufthansa, sources told Reuters, following months-long expressions of interest in TAP. The Portuguese carrier offers a direct line into the Brazilian aviation marketplace, something which is of interest to a number of parties looking at the long-mooted privatisation.
Flying under the EU’s radar?
Various outlets are reporting the deal could now be worth somewhere between 180 and 200 million euros, with Lufthansa seeking to limit its stake to 19.9%, according to a scoop by Corriere della Sera. If that seems like an oddly specific figure, it should be noted that it falls just below the 20% threshold that would trigger the need for approvals from the European Union’s monopolies regulators at the European Commission. Lufthansa has not commented.
The 19.9% stake is also well below the 51% defined by the previous Portuguese administration. A new government took over in April 2024 and is yet to set terms. But the German proposal might be seen as favourable, insiders say, thanks to the autonomy and control it would offer to the Portuguese.
The EU has been following developments in the aviation sector closely. With operating costs rising, it is an industry that has been trending toward consolidation, raising regulatory concerns about market shares and dominance.
Push to progress a deal
If such a deal were to go ahead it would be unlikely to be tied up before the third quarter of 2025, industry observers say, despite a huge push from current lawmakers to progress a deal.
With TAP profits now falling by 10%, Portugal could well be said to be as keen to move as quickly as possible to take advantage of a market that is hotting up. Lufthansa is known to have competition from British Airways group IAG and Air France-KLM. IAG failed to take over Spain’s Air Europa last month, after refusing to comply with EU mitigations. The German giant on the contrary, gained EU approval for the takeover of Italy’s ITA Airways in July. Sources say that once that takeover and relaunch is under way, Lufthansa may wish to take on more of TAP.
Off the back of that success, Spohr was set to meet with the Portuguese Finance Minister, Joaquim Miranda Sarmento, as well as the country’s Minister of Infrastructure and Housing, Miguel Pinto Luz. He was seen entering government premises at 11:00 am.
