Lufthansa CEO meets Portugal ministers to discuss TAP stake

Lufthansa CEO Carsten Spohr met with Portugal's finance and infrastructure ministers on Monday to express interest in acquiring a stake in TAP, the state-owned airline. The meeting is part of Portugal's efforts to privatize TAP by the end of the year, following the previous government's approval to sell at least 51% of the airline. Lufthansa is reportedly considering a 19.9% stake, which would avoid triggering European Commission scrutiny due to antitrust regulations. The Portuguese government is keen to expedite the privatization process, as there is significant interest from potential buyers, including British Airways owner IAG and Air France-KLM. The current administration, which took office in April, aims to leverage market interest to finalize the sale. TAP's strategic assets, particularly its flight slots to Brazil and other key markets, make it an attractive acquisition. Despite the ongoing interest, the formal privatization process has not yet commenced. Lufthansa's potential acquisition is viewed favorably by some in the government, as it may help maintain TAP's operational autonomy. The airline's recent financial performance has shown a decline in net profit, attributed to foreign exchange losses, highlighting the challenges it faces in a competitive market. As the European airline industry grapples with rising operational costs, consolidation is seen as a necessary strategy. However, regulatory concerns about market dominance have led to a cautious approach from Brussels regarding mergers and acquisitions. The outcome of this meeting and subsequent negotiations will be pivotal in shaping TAP's future.