After Air France-KLM had expressed their interest in TAP Portugal on 19NOV25, Lufthansa followed suit a day after, by throwing its hat into the ring. This means that there will be a showdown between the two heavyweights of European aviation over TAP. The third bidder, the IAG Group with British Airways, Iberia, Aer Lingus et alia, market experts are skeptical if they will be successful due to the group’s dominant position in Spain (Iberia + Vueling).
At the beginning of SEP2024, Lufthansa CEO Carsten Spohr flew to Lisbon to negotiate options with the Portuguese Ministry of Finance and high-ranking politicians to acquire stake in TAP Portugal. At the time of the trip, Spohr and his management team were still focused on acquiring the Italian airline ITA. This was accomplished in early JAN2025, with Lufthansa buying 41% of ITA’s shares for €325 million. In further steps, LH was conceded to acquire up to 90% of ITA’s shares. Air France-KLM and their U.S. SkyTeam partner Delta Air Lines had also expressed their interest in an ITA takeover but failed.
Three bidders
Now it looks like there will be a new showdown in Portugal – with an open outcome. Especially since on 20NOV the IAG Group appeared as third bidder on the scene. “IAG confirms it has submitted a statement of interest to Parpublica, in line with the government’s process for the part-privatization of TAP,” a spokesperson said in a statement to French agency AFP, referring to the Portuguese state holding company that owns TAP. “Several terms would need to be addressed before IAG could propose an investment,” the statement added.
In terms of prospects of success, Lufthansa has the advantage that TAP is a member of Star Alliance, the first global airline alliance founded in 1997 by five carriers, including Lufthansa, United, and Thai Airways. Another plus point is that the airline’s Hamburg-based technical subsidiary recently announced plans to build a new repair, overhaul, and maintenance center in Santa Maria da Feira near Porto, with a focus on engine maintenance. The number of employees there is expected to more than double from currently 450 to 1,000 by 2030.
Cherry on the cake
At the same time, Lufthansa management assured that, if the bid is successful, it intends to strengthen Lisbon as a transatlantic hub for the Lufthansa Group and expand connections between Europe, South, Central, and North America, and Africa. TAP will also continue to fly under its traditional name, as do Lufthansa subsidiaries Swiss, Austrian, and Brussels Airlines after being taken over by the German carrier. When asked what significance the integration of TAP Cargo into the Lufthansa network would have from the perspective of Lufthansa Cargo, LHC spokesperson Jan Paulin delivered this answer: “At this stage, Lufthansa Cargo is not providing any further assessment or comment beyond the official Lufthansa Group statement.”
TAP has a particularly strong presence in traffic to and from Brazil, both in terms of passenger and cargo transport. From this perspective, Brazil traffic is the cherry on the TAP cake for any investor. Last year, the airline carried a total of 16 million passengers on its network. It has been back in the black since 2022, after five consecutive years of losses.
Air France-KLM is a financially strong contender
One day before Lufthansa’s announcement, Air France-KLM expressed its interest in acquiring a 44.9% stake in TAP Air Portugal. This was stated by CEO Ben Smith during a press conference where he presented the airline’s Q3 results. No information has been provided as to whether talks between Air France-KLM and the Portuguese government regarding TAP have already taken place behind the scenes.
The Portuguese government confirmed nearly two years ago, in SEP2023, that it intended to privatize part of the national carrier. TAP, which was renationalized in 2020 to stem losses from the Covid-19 pandemic, is among the few remaining state-owned carriers in Europe, and is targeted by leading European airlines due to its routes to Brazil and Portuguese-speaking African states. The registration of further interested parties ended without result on 22NOV2025. TAP owner Parpublica expects to receive initial bids by APR2026.
