Portugal Picks Lufthansa Over Air France-KLM for a 44.9 Percent Stake in TAP Air Portugal
The government chose the German group after Wednesday's cabinet meeting, citing a bid 16 percent higher than its French-Dutch rival and a plan for pilots, fleet and Lisbon airport.
Wednesday, October 14, 2026/2 min read
The long contest for Portugal's flag carrier ended on Wednesday with a German winner. After its cabinet met, the government said it had chosen Lufthansa Group over Air France-KLM for a 44.9 percent stake in TAP Air Portugal, according to Euronews.
Prime Minister Luis Montenegro said the winning offer was 16 percent higher than the rival bid. Euronews puts the price of this first phase at 1.201 billion euros, which implies a value of about 2.552 billion euros for the whole airline.
What does Lufthansa get at TAP?
The state keeps 50.1 percent and 5 percent is reserved for TAP employees, with Lufthansa free to take up any shares the staff do not buy. Lufthansa will run executive and operational management, Euronews reports. Skift's report gives two versions of the price, one passage citing 1.025 billion euros for 44.9 percent rising to 1.2 billion for 49.9 percent, so the exact structure of the payment is worth checking against the final contract.
What has Lufthansa promised Portugal?
The commitments are large. Euronews lists 500 million euros for a pilot training school in Tancos, an innovation centre in Aveiro and a corporate services centre, plus Lufthansa Technik's earlier plan for Santa Maria da Feira. Skift adds that the Lufthansa Technik maintenance base in northern Portugal is expected to open in 2028 with up to 700 jobs.
On aircraft, Lufthansa has pledged a TAP fleet of 117 by 2035 and 130 after that, with up to eight Airbus A350-900s moved across from 2030. It also promised investment at Lisbon's Francisco Sa Carneiro airport, Faro and the airports of the autonomous regions. The government counts about 3,000 associated jobs and 5,500 direct and indirect jobs in total.
The state needed the cash. TAP reported a first-half 2026 loss of 99.2 million euros, 40 percent worse than a year earlier. Air France-KLM and Lufthansa submitted final bids at the end of September.
The reports give the losing bid only as a comparison. The 16 percent gap is the one figure on Air France-KLM's offer that appears in either account, so the size of the rival cheque is not public in what was reviewed.
What happens next for the TAP deal?
Nothing is final. Contracts must still be signed and the European Commission must approve the sale. Finance minister Joaquim Miranda Sarmento said the privatisation should close in 18 to 24 months, which points to 2028. Skift flags one wrinkle for regulators: TAP is in the Star Alliance but outside the transatlantic joint venture that Lufthansa runs with United and Air Canada, so bringing it in would need its own review.
For passengers, the first things to watch are the competition filing in Brussels and how Lufthansa uses TAP's Brazilian network, where a fifteenth Brazilian city is due to begin service this month, according to Skift.
Published in The Outspoken Digest
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