Lufthansa seen leading bid for TAP stake

Lufthansa Group (LHAd) is reported to be the frontrunner to acquire a 44.9% stake in TAP Air Portugal as part of the airline’s privatisation process. The indication follows a bidding contest in which major European airline groups sought a minority position in the Portuguese flag carrier. The prospective stake is described as the portion earmarked for a strategic investor in the government’s plan.

The reported outcome positions Lufthansa ahead of rival bidder Air France–KLM for the 44.9% shareholding. This would give the German group a significant minority interest while leaving control of TAP with the Portuguese state under the current framework.

Portugal’s government was expected to formalise its choice of preferred buyer at an extraordinary Council of Ministers meeting on 14 October 2026. This meeting was identified as the key step to move from a competitive bidding phase toward exclusive negotiations with the selected airline group.

Under the privatisation plan cited in the reporting, 44.9% of TAP is intended for the strategic investor, 50.1% would remain in the hands of the Portuguese state and a further 5% of shares would be reserved preferentially for employees. This structure is designed to bring in a private partner while maintaining majority public ownership and an employee share component.

Reports state that Lufthansa’s proposal for the TAP stake is an all-cash offer. By contrast, Air France–KLM is described as having submitted a bid combining cash with shares. The differing structures of the bids underline contrasting approaches to the transaction, with cash versus mixed consideration on the table.

Observers cited Lufthansa’s financial position as an important factor in how the competition between bidders was assessed. While detailed valuation metrics were not disclosed in the reports, the all-cash nature of Lufthansa’s offer was highlighted as a distinguishing element relative to the rival cash-and-shares package.

Even if Lufthansa is confirmed as the preferred bidder, the transaction is not expected to conclude immediately. The reports emphasise that a final agreement would still need to be negotiated between the parties following the government’s selection of a partner.

In addition to final negotiations, the deal would require approval from the European Commission’s competition authority. The review process is reported to be expected to take around 18 to 24 months. As a result, the budgetary impact of the privatisation is projected to materialise around 2028 rather than in the near term.