Germany's Lufthansa Beats Air France-KLM to Take $1.3 Billion Stake in Portugal's Flag Carrier — Update
By Joshua Kirby
Deutsche Lufthansa won out over rival Air France-KLM in a bid to take a near 50% stake, valued at around $1.34 billion, in Portuguese airline TAP.
Portuguese Prime Minister Luis Montenegro said Wednesday the government had chosen the German group to take the 49.9% stake, the first phase of the privatization of the flag carrier, for 1.20 billion euros ($1.34 billion) valuing the airline at some 2.55 billion euros. The state will remain the largest shareholder with a 50.1% stake.
"This is the best thing for the future of the company, and is the best way to protect the national interest," Montenegro said.
Lufthansa said it welcomed the decision.
"Lufthansa Group is pursuing a clear strategic agenda: to support TAP Air Portugal's growth while preserving its national identity and to sustainably strengthen Portugal's connectivity, particularly with North and Latin America," the group said. The company has offered an initial fee of 1.025 billion euros for a 44.9% stake, with a total purchase price of up to 1.2 billion euros including a ticking fee and up to 5% of shares offered to TAP employees.
Lufthansa's offer valued TAP at 16% more than a rival offer from Air France-KLM, and was more certain, the government said.
Air France-KLM didn't immediately respond to a request for comment.
The decision brings to a close a contest between Lufthansa and Franco-Dutch rival airline group Air France-KLM for the acquisition of the stake. The two companies in April said they submitted nonbinding offers for TAP, after the Portuguese government said last summer that it planned to sell a 49.9% stake in the carrier.
A second phase of the privatization could begin in 2028 and would see the Portuguese state reduce its stake in TAP to become only the second-largest shareholder, the government said Wednesday.
"The prime minister considers that integrating TAP into a large international group will allow the company to boost its competitiveness and enlargen its fleet, as well as increasing the number of destinations and connections, and boosting investment in the country's aeronautical sector," it said.
Write to Joshua Kirby at joshua.kirby@wsj.com; @joshualeokirby
(END) Dow Jones Newswires
October 14, 2026 12:01 ET (16:01 GMT)
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