Lufthansa picked over Air France-KLM for TAP stake

Portugal’s government has selected Lufthansa over Air France-KLM as the preferred bidder for a stake of up to 49.9% in TAP Air Portugal. The deal is valued at €1.2 billion ($1.3 billion), positioning Lufthansa as the strategic partner of one of Europe’s few remaining unaligned flag carriers.

In a statement, Lufthansa said it welcomed the Portuguese government’s decision to select its offer in the TAP Air Portugal privatisation process. Through the planned initial acquisition of a minority stake, the group aims to support TAP’s growth while preserving its national identity and strengthening Portugal’s connectivity, particularly with North and Latin America.

“TAP Air Portugal is a strong and profitable airline, our long-standing partner in Star Alliance and internationally successful as a leading carrier on South Atlantic routes. It is known for its outstanding employees and has a compelling business model. With today’s decision, the Portuguese government has paved the way for TAP Air Portugal to continue this success story together with Lufthansa Group. At the same time, this allows us to consistently pursue our internationalisation strategy and sustainably strengthen our position in the South Atlantic market. Our company has enjoyed a close and trusted partnership with Portugal for many years. For decades, we have invested in the country, created and secured highly skilled jobs, and connected Portugal with Europe and the world. We look forward to a shared future with TAP Air Portugal and to continuing our constructive cooperation with the government in Lisbon!” said Carsten Spohr, Chairman of the Executive Board and CEO of Deutsche Lufthansa.

The deal, years in the making and repeatedly delayed, marks the next step in the consolidation of Europe’s airline industry, a process considered necessary to help smaller national carriers become more resilient as part of larger groups, Reuters reported.

Parpública, the Portuguese state entity handling TAP Air Portugal’s reprivatisation, invited bidders to submit final binding offers on 4 September 2026. Air France-KLM and Lufthansa Group, the two airline groups that were competing for a 44.9% stake in the flag carrier, subsequently submitted their final offers.

Following its selection as the preferred bidder, Lufthansa said in a statement today: “Lufthansa Group has offered a purchase price of EUR 1.025 billion for the 44.9 percent stake. This amount could increase to up to EUR 1.2 billion for the acquisition of a 49.9 percent stake, due to up to 5 percent of shares initially offered to employees as well as a ticking fee.”

The company added that previous acquisitions had shown that a majority stake could create additional benefits for all parties involved.

Lufthansa Group has operated in Portugal for more than 70 years. Its airlines currently offer 353 weekly flights to six destinations in the country, representing a 75% increase in capacity compared with 2019. More than 500 people work for Lufthansa Group companies in Portugal. This number is expected to exceed 1,000 direct jobs by 2030 following the development of a new Lufthansa Technik site in Santa Maria da Feira, near Porto, where construction began in June.

Lufthansa Group is working with the Portuguese government and Parpública to finalise the transaction documents. The group expects to sign the acquisition agreements shortly, with completion remaining subject to approval by the relevant authorities.