Luis Gallego, Chief Executive Officer (CEO) of International Airlines Group (IAG), has explained why the group decided not to pursue the acquisition of TAP Air Portugal in its privatization process.
Gallego said that “having a path to control was essential for us,” explaining, “For the group to achieve a profit margin of 12% to 15%, appropriate measures need to be implemented in each region and at each airline, and that requires the freedom to determine strategy. Under those constraints, we could not find a way to improve TAP Air Portugal’s performance.”
He added, “We still believe that development within IAG would have been the best option for TAP Air Portugal, and it would also have been an opportunity for us.” However, he said that IAG will pursue organic growth in the Brazilian market and build partnerships within the region. Regarding whether TAP Air Portugal will join the Lufthansa Group or Air France-KLM, he said, “For us, it is the same. We will compete as we do in other markets.”
Although both the Lufthansa Group and Air France-KLM expressed interest in acquiring TAP Air Portugal, the Portuguese government selected the Lufthansa Group as the buyer of the shares. The sale price could reach as much as €1.351 billion, and Lisbon will become the group’s seventh hub.
Notice
This article was generated using automatic translation by GPT-4 API. The translation may not be accurate.
