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The chief executive of Portugal’s national airline TAP has called on the government to maintain a stake in the flag carrier as he expects its planned sell-off to start in earnest within months.
Luís Rodrigues also wants to bring in non-aviation investors to ease competition concerns amid growing unease in Brussels over the prospect of an industry dominated by a handful of the region’s big airline groups.
The Portuguese government put TAP up for sale last year, opening the way for more airline consolidation in Europe, and a potential bidding war involving the EU’s major carriers.
The new centre-right minority government, which was elected in March, said on the campaign trail it wanted to sell 100 per cent of the airline.
But Rodrigues stressed the state should keep a stake in the carrier, particularly given Portugal’s dependence on tourism.
“My recommendation would be for the Portuguese government to maintain a position there, to be part of the whole development process,” he said.
“Just to make sure that if actors change, nobody will come in with a different agenda,” he added, pointing as an example the need to serve Portugal’s autonomous islands, Madeira and the Azores.
“I think some time we may be ready for a 100 per cent sale, but let’s take that step by step.”
Prime minister Luís Montenegro said during the election campaign that a 100 per cent stake sale should come with safeguards to protect Portugal’s strategic interests, such as maintaining Lisbon as a hub airport.
The previous government said it wanted to sell more than 50 per cent of the company but less than 100 per cent and keep a stake in the hands of the state.
Europe’s three big airline groups IAG, Air France-KLM and Lufthansa, which own a range of subsidiaries and want to expand further, have expressed an interest in TAP amid a sharp rise in dealmaking across the sector.
The Portuguese airline offers strong links to Brazil and the lucrative South American market for companies that do not already have a foothold there, as well as a way into Africa through its routes to the Portuguese-speaking countries of Angola and Mozambique.
IAG has already agreed a deal to buy Spain’s Air Europa, while Lufthansa has taken a 41 per cent stake in ITA Airways, the successor company to Alitalia.
Air France has also taken a 20 per cent stake in struggling Scandinavian airline SAS as part of a deal involving private equity firm Castlelake and the Danish state.
Rodrigues said he expected the airline to keep its brand name and identity in any deal and suggested the government might want to involve private equity or other investors rather than sell directly to one airline, partly to help ease competition concerns in Brussels.
IAG and Lufthansa’s deals are being investigated by EU regulators.
“If we design a sale that is not 100 per cent [of the airline], and that may be not necessarily to one group but to airlines [plus] finance or private equity, or local capital, which is always a good thing politically, that might be much more fluid and easier,” Rodrigues said.
However, he remains convinced the industry trend towards consolidation will continue. “I believe we need a little more consolidation in Europe.”
He added: “I would love by the end of 2025 for the whole thing to be done with . . . That’s not going to be easy, but if everything goes all right, I think that’s possible.”
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