Lufthansa Group and the Portuguese government signed an agreement to acquire a stake in TAP Air Portugal at Humberto Delgado Airport in Lisbon on November 3. Completion of the transaction is subject to approval by the European Commission and other relevant authorities.
The purchase price is EUR 1.025 billion and will be funded from available liquidity. The acquisition will give Lufthansa Group a 44.9% stake. Should it acquire shares offered preferentially to employees, its holding could increase to as much as 49.9%, with the purchase price, including a ticking fee, potentially reaching up to EUR 1.2 billion.
Lufthansa Group said it welcomes the prospect of TAP Air Portugal’s full privatization. While it expects to realize the majority of the estimated synergies of up to EUR 450 million even as a minority shareholder, it said acquiring a majority stake would accelerate TAP Air Portugal’s growth, strengthen its competitiveness, and unlock further potential.
At the core of the growth plan is the expansion of TAP Air Portugal’s route network, with particular emphasis on routes linking Portugal with Brazil, Portuguese-speaking Africa, and North America. Lufthansa Group currently holds around a 9% share of the Europe-Latin America market, but this would increase to approximately 20% when combined with TAP Air Portugal, placing it on par with major competitors. Lisbon will become Lufthansa Group’s seventh hub. Porto, the Azores, Madeira, and the Algarve are also included in the growth strategy.
Lufthansa Group has operated in Portugal for more than 70 years, and its group airlines currently operate 353 weekly flights to six cities in Portugal. This represents a 75% increase compared with 2019. More than 500 people work for Lufthansa Group companies in Portugal, and the new Lufthansa Technik facility in Santa Maria da Feira, near Porto, where construction began in June, is expected to increase direct employment to more than 1,000 by 2030.
Carsten Spohr, Chairman of the Executive Board and CEO of Lufthansa Group, commented, “The two companies’ networks complement each other ideally and open up new growth opportunities in Portugal, particularly in South America and Brazil.” He added, “Together with TAP Air Portugal’s employees, we want to continue the company’s successful journey and develop Lisbon into a Lufthansa Group hub while preserving its Portuguese identity.”
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